There is a new champion on the horizon. A blockchain startup has gathered around $4 billion this week, beating the record of the largest initial public offerings on world’s stock bourses. And that’s not all. Most importantly, it has gathered such an enormous sum without even starting out its project. This startup is Block.one, registered on the Cayman Islands.
According to CNBC, Block.one is financing its DLT platform called eos.ios with the help of ICO. The startup has managed to raise a multibillion-dollar amount. However, the investors still are not aware of how the largest part of the collected funds will be used.
As it is said in the report, lots of investors have piled into the project for two main reasons. Firstly, that’s because of the rage and, secondly, due to the constitutors’ pledge to repeat the success of their previous blockchain projects.
The startup doesn’t offer all its investors to get a stock-share in a company as IPO does. Instead, it runs an ICO, which provides such digital coin eos. The company gives out tokens, which use case is dependent on a pledge that the platform will be applicable in a virtual network once it is constructed.
When participating in the ICO, investors used ETH to swap them into fresh eos tokens instead of the US dollar.
As per the Token Report, there have been raised 7.12 million ether coins. At May 31 exchange rate data, an ether cost $576. Thus, in total, there were fundraised approximately $4.1 billion. However, this amount is not stable due to the fact that ether’s price changes and it definitely will when the ICO closes.
William Mougayar, a managing partner at JM3 Capital and author of "The Business Blockchain,” said:
"They have set the bar very high for themselves in terms of delivery expectations. Now is the time to not just deliver the coins but the technology with it."
Also, according to his words, Block.one is an anomaly. The largest IPO in 2018 was by AXA Equitable Holdings, as the company collected $2.8 billion. In the meantime, ADT gathered $1.5 billion, as per Pitchbook data.
Risks and Dangers
Interestingly, in "Last Week Tonight"-episode, released two months ago, the show’s host John Oliver mentioned eos in his speech, saying viewers should be wary about the “speculative” craze and jeopardies of piling into cryptos. The host also emphasized that the project has not even been set off yet. In particular, he said:
"It can be incredibly hard to tell which companies are for real. If you want a good example of this, look at Block.one, which has raised $1.5 billion."
In accordance with Block.one’s constitutors’, the new system will support more effective operations for dApps. Hence, it will beat the already functioning platforms like Ethereum. Should the eos.ios succeed, it could leverage the adoption of crypto-related tech trend. However, CNBC emphasizes, they still have a long way to go as the product is released on June 1.
Despite anything, Mougayar said:
"This is the crypto world we live in. The eos founders have done a great job at marketing their technology, ahead of its delivery."
Any Other Successful Fundraises Apart From Block.one?
New Alchemy presented a list of other successful fundraises behind the record-breaker Block.one. And here are 10 of them:
- Telegram Open Network — $1.7 billion
- Dragon Coin — $320 million
- Huobi — $300 million
- HDac — $258 million
- Filecoin — $257 million
- Tezos — $232 million
- Sirin Labs — $157.9 million
- Bancor — $152 million
- Bankera — $150.9 million
- Polkadot — $142.4 million
Even though the launch of the Block.one’s project is risky, the amount that the company has raised indeed can save it.
Block.one has already mentioned it would spend $1 billion to attract more developers, whereas the rest of the funds will be used for lobbying serious regulators and making ties with banks.