Blockhive Initial Loan Procurement (ILP): Project Fundraising?
Blockhive is a platform that incubates project with the help of blockchain technology. The company uses practical and innovative solutions to help companies unlock new markets. Blockhive collaborates with partners to come up with a blockchain strategy and jointly develops projects with the partners.
Once the projects are completed, revenue from these projects is shared between Blockhive and its partners. Blockhive core business solutions include a smart wallet referred to as eesty, a mining operation located in Estonia, e-Best ventures and an ILP fundraising solution under Takenote.
What Is Blockhive’s ILP
Instead of raising funds using ICO, Blockhive has launched a post-ICO funding model that is based on transferable credit. The model is referred to as Initial Loan Procurement (ILP). The ILP is a loan agreement that allows the company to get funding in order to expand its ecosystem while allowing creditors to earn interest from the money loaned.
The loan agreement will be executed on the Agrello platform. Creditors get to earn passive income from the incubated projects when they participate in the platforms ILP. The creditors will get an interest payment of 20% of the annual operating profits got by Blockhive. There is potential to increase the interest payments as the firm incubates more projects. The payment will be paid in ETH directly to the creditor’s contact address. The principal amount will be repaid to the creditors who hold the loan agreements until the maturity date of 25th January 2028.
Interest will be paid to creditors who hold the loan agreements on the distribution date. To secure the right of interest payment, creditors must provide ID verification and satisfactorily complete and sign the loan contract. The distribution date will be announced at least two weeks before the advance day. All the money transactions including the incoming and outgoing loan and interest payments will be based on Euro but made in ETH.
Hive Token Sale
Creditors, after making loans to the platform and digitally signing loan agreements, will receive Hive tokens. The interest paid on the loans will be based on the loan balance but not on the Hive tokens balance. Hive tokens are Future Loan Access Tokens (FLATs) that also allows the creditors to transfer their loan agreements to others. The loan amount equivalent to one Hive token is € 0.045.
The second part of the public ILP is already underway having started on 14th May 2018. The total tokens issued are one billion and 30% of these are available during the public ILP. Contributors are expected to register and set up an account on Tokenote and sign the loan agreement before sending the eth contribution to the Blockhive ILP project address.
Advantages Of The ILP
The best thing about the digital loan procurement model is that it has clear legal parameters that already govern existing credit markets. Contributors in the ILP period can be assured that their funds are protected by legally binding loan agreements regulations. The interest earned will also fall under the rules used in the jurisdiction of the token owner.
Another benefit of this model is that it sidesteps the disadvantages that come with over tokenization where projects using the token sale to raise funds damage the utility of the token in the economy for which it was designed.