Bitfinex Holds On to 27% Of Revenue from Tokinex to Buy Back LEO Token
- Bitfinex has been the subject of scrutiny from the public as their funds are locked up with Crypto Capital.
- A recent blog post announced that Bitfinex would be purchasing outstanding LEO to burn.
The Tokinex platform was developed by Bitfinex as a way to launch initial exchange offerings, though it is now finding a different use. According to an article by The Block, the cryptocurrency exchange is going to be using 27% of the revenue from the IEO platform as a way to purchase their LEO token back, both from past and future profit.
Bitfinex said in a statement, “Over the course of the previous 15 days, we have purchased outstanding LEO for 27% of the revenues generated by the first Tokinex IEO, Ampleforth. These LEO will be added and burned.” The exchange explained that there have been 1,920,061.10 LEO tokens burned so far, with a remaining supply of 998,079,938.90 tokens.
In a whitepaper from iFinex, the parent company of Bitfinex, the company stated the work will continue “until no tokens are in commercial circulation.” It further added,
“Repurchases will be made at then-prevailing market rates. LEO tokens used to pay fees may also be used to satisfy this repurchase commitment.”
The LEO token only entered the market last month, following the raising of close to $1 billion in both USD and the USDT stablecoin. The token said was private, and its original purpose was to cover the funds that were locked up by Crypto Capital – $850 million. With this LEO burn mechanism, Bitfinex hopes to purchase the tokens to completed redeem 100% of the funds. Last week, The Block stated that Bitfinex had accumulated close to $10.4 million in revenue, based on trading fees.
The first IEO sale for Ampleforth was recently completed by Tokinex, though the second token sale is planned for July 16th. To view the official blog post on this matter, visit here.