Unconfirmed: Bitfinex Alleged to Be Mulling Launch of Exchange Token Via IEO

click here to see original post

Crypto exchange Bitfinex is allegedly planning to issue a native exchange token, a post from Bitfinex shareholder Zhao Dong to Chinese social media platform Weibo revealed on April 30.

Zhao, who also runs a bitcoin (BTC) over-the-counter trading desk, has claimed that the exchange’s alleged token plans are still evolving. His post thus warned the public against any schemes allowing users to use a native bitfinex token as a voting stake, noting that:

“Bitfinex does have a currency plan, but the details are undecided. At present, any attempt to use the name of Bitfinex to host a vote, saying that there is a quota may be a liar, vigilance!”

An April 29 tweet from the co-founder of crypto investment holding firm Primitive Ventures, Dovey Wan, has also reported the news that Bitfinex is allegedly planning the issuance of its own token, and is moreover ostensibly mulling the launch of an initial exchange offering (IEO) that would raise $1 billion in associated stablecoin tether (USDT).

As previously reported, so-dubbed initial exchange offerings have latterly emerged as an alternative model of token offering wherein a centralized crypto exchange acts as a form of underwriter. The exchange generally operates sales and ostensibly vets both the projects themselves and prospective investors.

Major crypto exchange Binance has been an early mover in the IEO space, with its token sales platform Launchpad hosting a token sale for the tron-based bittorrent token (BTT) this January, which users could buy using either native exchange token binance coin (BNB) or tron (TRX).

Unconfirmed news of Bitfinex’s alleged IEO and proprietary exchange token plans have sparked a wave of community concern in light of the lengthy history of controversies that have beset Bitfinex and Tether, both of which share the same CEO. As Dovey Wan noted in a further tweet to the same thread on April 29:

“I just don’t see how this can be sustainable, it won’t make Tether fully-backed again unless they distribute profit/new fund raised back to Tether reserve. BFX has already securitized + tokenized its future cash flow for their last hack, this is another layer of leverage on top.”

As reported earlier this month, the New York Attorney General’s office has alleged that Bitfinex lost $850 million and subsequently used funds from USDT operator Tether to secretly cover the shortfall. In an official response, both companies have officially claimed that the office’s allegations were “written in bad faith and riddled with false assertions.”

Zhao Dong, as well as fellow Bitfinex shareholder Tian Jia, another shareholder, have both told reporters their support for the exchange is unwavering in spite of the ongoing controversy.

Share !