Binance-backed FTX Aims for Billion-Dollar Valuations via Equity Token Sale

On Feb 26, 2020 at 8:15 am UTC by Bhushan Akolkar · 2 min read
Binance-backed FTX Aims for Billion-Dollar Valuations via Equity Token Sale
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Derivative platform FTX said that it plans to conduct its FTX Equity token sale next month in March 2020. The minimum investment is kept at $250,000 with each equity token priced at $2.

On Tuesday, February 25, Binance-backed derivatives platform FTX announced that the company aims for billion-dollar valuations through the equity token sale. FTX is popular for creating the Shitcoin Index for low market cryptocurrencies.

The announcement read that FTX_Equity token is willing to bring all investors with a minimum capital of $250K. For each of its equity token, FTX has put a price of $2. Thus, investors holding the FTX_Equity token will get ownership in FTX’s holding company FTX Trading Ltd. Besides, investors can purchase the equity tokens directly from FTX against USD and its native token FTT. Moreover, investors can also purchase equity tokens using public cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH).

The important thing is despite investors getting ownership in FTX, they won’t get any voting rights. However, investors will be eligible to receive the dividend payouts. Also, investors can convert between the tokenized FTX_Equity into the conventional FTX equity but only with a minimum of 1.25 million tokens.

As such retail investors across the globe can participate in the FTX token sale except for U.S. investors. The United States jurisdiction prohibits FTX from operating in the country.

The exchange said that they have yet not decided on the number of equity tokens up for sale. But the exchange said that the equity token sale will happen in line with FTX’s value.

FTX Equity Token Sale in March 2020

The sale for the FTX equity token is scheduled next month on March 7. Last year in May 2019, the derivatives platform unveiled its FTC futures, options, and perpetual contract for 30 different digital assets. In August 2019, the company also raised $8 million in private equity round.

Another feather to FTX’s cap was Binance acquiring a minority stake in the exchange in December 2019. By this time, the exchange was successfully processing $170 million in average monthly volume for its Bitcoin (BTC) and Ethereum (ETH) futures. By February 2020, this figure has nearly doubled to $335 million.

Binance’s minority stake acquisition helped FTX to raise its valuations further.

“Revenue would justify that valuation with moderate growth, and would justify a significantly higher valuation if we can sustain the high growth rate we’ve been having,” said an FTX spokesperson, speaking to CoinDesk on the FTX’s sale of tokenized equity.

Altcoins, Bitcoin, Cryptocurrency news, News, Token Sales
Bhushan Akolkar
Author: Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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