Shareholder States $1 Billion Already Has Been Lined Up For Bitfinex’s IEO LEO Token Sale

Shareholder States That $1 Billion Has Been Lined Up For Bitfinex’s Token Sale

  • Bitfinex has accrued $1 billion in soft and hard commitments for funding.
  • A public sale is possible, but only if the 1 billion USDT tokens are not sold during the private sale.

Bitfinex has been in the hot seat lately for pulling liquidity from Tether in an effort to recover a massive $850 million. Back then, the company expressed that they would be launching an exchange token sale instead, setting a goal to reach $1 billion in investments, which would more than cover the loss. One shareholder involved in the matter, Dong Zhao, said that the exchange has already become the recipient of their desired funding through hard and soft commitments.

As a result of the contributions, the founder of DGroup made a WeChat post today that suggested there is a “high possibility” that the platform will opt out of the token offering for the LEO token. Speaking to CoinDesk, Zhao added that the commitments from investors were made in USDT, which is the stablecoin of Tether. However, it is curious that the exchange is accepting their funding in the very tokens that they had pulled liquidity from.

In a soft commitment, the investor has not actually locked in their Tether tokens for LEO. They still have a chance to back out, so Bitfinex has not actually raised all of the funding yet. Zhao added that withdrawing from the intended amount would result in the tokens being issued to the rest of the participating investors in the order that they come to collect.

The token sale was originally announced shortly after the New York Attorney General confirmed that they were trying to learn more about the potential cover-up operation for the aforementioned $850 million loss. The authorities in Poland, Portugal, and the United States have reportedly seized the missing funds from Crypto Capital, a payment processor.

At this point, Zhao said that DGroup has made an investment in the LEO token being offered but declined to publicly release the amount of funding that went into it. At this point, there are no certain details about the hard commitments that Bitfinex has already confirmed from the platform, but Zhao said that users of the Renrenbit crypto-lending app have made $20 million in hard commitments.

Within the last few days, Bitfinex had only just released an official whitepaper for this possible token sale. There have been suggestions that a public sale could be launched after the private phase ends if Bitfinex does not meet their desired goal. However, the company’s whitepaper was unclear on the terms of this chance. Specifically, the whitepaper notes that the amount under the 1 billion USDT goal could result in a public sale to finish selling the remaining tokens.

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