Sunday, March 24, 2019

Binance Updates Token Sale Format on Launchpad Platform, Binance Coin Shoots 10%

Coinspeaker
Binance Updates Token Sale Format on Launchpad Platform, Binance Coin Shoots 10%

In a recent announcement today, March 24, Binance plans to tweak the token sale format on its Launchpad platform. As part of the Initial Exchange Offering (IEO), Binance launched its “Launchpad” platform that allows users to participate in token sales.

The Binance Launchpad platform has conducted three successful token sales until now. This includes the sales of Tron’s BitTorrent Token (BTT), Celer Network Token (CELR), and Fetch.Ai Token (FET).

As per the announcement, the new token sale format includes a lottery system instead of the existing first-come-first-served system. The number of lottery tickets issues will depend on the users’ BNB balance 20 days before the lottery event date. Higher the BNB balance a user holds, the more lottery tickets he/she can receive. The maximum lottery tickets eligible per account in 5.

Binance notes that the lottery draw will be a completely transparent system with a random selection of lottery tickets. However, users have to mandatorily follow the country restrictions and KYC procedure for account verification.

Creating a Fair Token Issuance Method

The reason behind moving to a new system is that Binance experienced a few issues with the previous token sales on Launchpad. During the FET and BTT sales, the Launchpad platform witnessed heavy traffic resulting in website overload. The result was several traders got locked out of the portal.

During the CELR token sale, Binance CEO Changpeng Zhao said:

“39003 people tried to buy, 3129 people got some. 35000 people will be somewhat unhappy… Some users experienced a caching issue that looked like they need to re-login, a refresh would solve the issue. Others still experienced network delay”.

The new lottery system will ensure more fairness in this ecosystem. Binance explains the entire modus operandi of the newly introduced lottery system model for token sales.

Risks And Trade-Offs

While introducing the new system, Binance remains transparent about the associated risks and trade-offs. For e.g. the exchange notes that

BNB price will fluctuate during the 20 day period. If BNB price drops, it is entirely possible the drop in BNB price will outweigh any gains made by the new token. That is first assuming you win in the lottery draw. Further, the new token being sold is not guaranteed to increase in price. It may drop in price.

It also mentions other risks and how holding BNB doesn’t ensure an allocation. Thus, it recommends investors to weigh-in all risks before participating in the token-sale and asks them to conduct thorough research about each project beforehand.

The new announcement has seen a positive response from BNB investors. At the press time, the price of Binance Coin (BNB) is 12.84% up which is trading at $17.12 with a market cap of $2.47 billion. Binance Coin is currently the seventh most-valued crypto token in the market.

Binance Updates Token Sale Format on Launchpad Platform, Binance Coin Shoots 10%



Binance Updates Token Sale Format on Launchpad Platform, Binance Coin Shoots 10%

Cryptocurrency is a digital currency that uses encryption (cryptography) to regulate the generation of currency and verify the transfer of funds, independently of a central bank. Cryptography is the practice and study of techniques for secure communication in the presence of third party adversaries.


Blockchain 101 · Crytpo Currency Market
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Saturday, March 23, 2019

Bakkt’s Post-Money Valuation Stands At $740 Million Even Before Launch

Coinspeaker
Bakkt’s Post-Money Valuation Stands At $740 Million Even Before Launch

ICE’s Bakkt platform is yet to hit the crypto market streets yet its valuation stands currently at $740, reports The Block. As per the publication, this is the post-money valuation of the company.

It means the “company’s value after outside financing and/or capital injections are added to its balance sheet”. While collaborating with big industry players, ICE has reportedly sold 25% of Bakkt’s shares to external investors. This includes names like Pantera, Galaxy Digital, Starbucks, Microsoft and others.

Announced in August 2018, Bakkt is one of the most awaited projects of 2019. Also, the project is facing several delays due to regulatory concerns and the slowdown in the crypto industry.

Just before the ending of 2018, Bakkt managed to raise a whopping $182 million from twelve high-profile investors. The Bakkt platform aims to provide institutional access to the crypto market.

To bring the institutional players to the crypto industry, Bakkt plans to launch Bitcoin Futures contracts currently under review by the CFTC. Earlier this year in January 2019, Bakkt acquired some of the assets belonging to Rosenthal Collins Group (RCG).

Projected Returns to Bakkt’s Investors

As said, Bakkt is already facing delays in its launch due to several regulatory barriers. However, with its $740 million value, the interesting question is what shall be the projected returns of Bakkt’s investors.

Also, Bakkt is reportedly keeping its contract-fee very low to just $0.50 per contract. This could be just 1 basis point with the next cheapest trading option at 8 basis point. An unnamed source said:

“From a cash-flow perspective, Bakkt will not be earning much based on their proposed contract fees, so they really need a lot of volume.”

Also, the source notes that Bakkt has to very precise and flawless in its execution post-launch. “A lot of things will need to line up for investors to receive returns that they would typically expect for a Series A,” the source said.

What If Bakkt Fails to Deliver?

It is important to think what about the huge investments at all if Bakkt’s plans fall on face. What if the platform fails to generate enough cash-flow sources or institutional adoption?

An SEC Filing highlights the investor “get-out” clause. The filing notes “non-ICE partners in Bakkt hold a put option to require us to repurchase their interests subject to certain terms.” Furthermore, delays in execution will allow investors to manage their exit.

One of the industry sources says that Bakkt plans to raise its pre-money valuation to $1 billion during its next fundraising round. It remains to be seen how things turn around going further.

The arrival of Bakkt has kept investors hopeful for the growth of the crypto market.

Bakkt’s Post-Money Valuation Stands At $740 Million Even Before Launch



Bakkt’s Post-Money Valuation Stands At $740 Million Even Before Launch

Cryptocurrency is a digital currency that uses encryption (cryptography) to regulate the generation of currency and verify the transfer of funds, independently of a central bank. Cryptography is the practice and study of techniques for secure communication in the presence of third party adversaries.


Blockchain 101 · Crytpo Currency Market
---------------------------------------------------
Trezor: Hardware Wallet
Binance: Exchange for Traders
Ledger Nano S: Hardware Wallet
Coinbase: Exchange for Investors
CoinSwitch: Wallet-to-Wallet Exchange