Tron’s BitTorrent was a Hot Crypto Company Commodity: EOS, Filecoin and NEO All Tried to Acquire First
The Details of the BitTorrent Sale Process
Before Justin Sun acquired BitTorrent, the platform had attracted many suitors. Besides Tron and Neo, ICO and protocol Labs, a blockchain project that focuses on governance and also runs Filecoin, was talking to BitTorrent with the intentions of purchasing the entity.
Moreover, parties that were privy to the negotiation process have confirmed that the participants were multiple companies form the blockchain industry involved in the discussions. However, these sources did not indicate whether non-blockchain enterprises expressed interest in buying the peer-to-peer file-sharing platform. In the end, Justin Sun won the bid to acquire BitTorrent.
Although BitTorrent has enormously contributed towards the decentralization of the internet through its software infrastructure, the company has struggled to establish a sustainable business model. At the end of last year, Bram Cohen, the founder and the brain behind the core technology of BitTorrent, as he went on to launch Chia, a crypto mining firm that emphasize on eco-friendliness.
According to confidential documents, the transfer of BitTorrent ownership stated when Justin Sun approached the platform’s main shareholder, the DCM venture capital firm. Precisely, Justin met with David Chao, a member of the BitTorrent executive board who controlled the majority of the enterprise’s stock.
During the meeting, he told Davis that he wanted to purchase the preferred stock of DCM to gain control over the BitTorrent platform. However, Chao also compelled Justin to buy the company’s common stock so that standard shareholders benefit from the purchase.
The most significant competitor to Justin’s bid to acquire BitTorrent was Neo Global Capital, the company that owns the NEO digital currency, which widely regarded as the Chinese equal of Ethereum. Though Neo Global Capital submitted a bid that exceeded Justin’s by a whopping $50 million, it was rejected for a number of reasons. In total, there were six interested parties during the sale of BitTorrent, with half of them submitting bids while the others walked away.
Additionally, BitTorrent also approached Block one, the company that developed the EOS protocol, to ascertain whether they would be interested in buying their platform. Back then, Block one had managed to arise a remarkable $4 billion in their year-long ICO crowdsale event. Regarding this, Brendan Blumer, the CEO of Block one, affirmed the approach by BitTorrent and also said that his company was not interested.
The Attractiveness of BitTorrent
As of now, Tron is yet to issue a reason behind the acquisition of BitTorrent, although many speculate that Justin was attracted by the platform’s 100 million monthly users. On the other hand, the driving factors behind the other bidders’ interest are known.
For instance, Neo Global Capital envisaged a scenario where they could use BitTorrent to build a decentralized file storage protocol for DApps within their blockchain ecosystem.
Apparently, Icon was excited by the prospect integrating BitTorrent’s software into their systems, while Protocol Labs was attracted by the large client base of BitTorrent. Nonetheless, none of these two companies made an offer to BitTorrent, probably because of the supposedly exorbitant pricing, concerns over the infringement of copyrights associated with the protocol and challenges in the monetization and integration of BitTorrent’s technology.
Essentially, the only entities that expressed serious interest in purchasing BitTorrent were Neo Global Capital and Tron. According to Ben Lebeau, the head of Sandwich Video’s crypto division, the allure towards BitTorrent is understandable. Firstly, the business model and standards employed by BitTorrent conform to the desires of the crypto community.
In this regard, Ben lauded BitTorrent for revolutionizing the file sharing industry that had been dominated by centralized content delivery networks. Ben further added that Tron acquired BitTorrent to strengthen their presence in the US. He concluded by saying that Tron can create a true internet of value if they harness the capabilities of BitTorrent.