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300 investors and counting – INX’s Ethereum-based IPO marches ahead

Photo of: Sangeetha Golchha
by Sangeetha Golchha

The cryptocurrency and security token exchange’s blockchain IPO can be considered the first of its kind. As per the estimates about 300 investors have forked out funds for the Initial Public Offering (IPO) of crypto exchange INX. The sale of INX’s Initial Public Offering took place on September 18th and three days after the first distribution transaction took place, roughly 210 of the more than 500 registered and whitelisted investors had invested. 

While the sale started the public could see roughly the investors receiving INX tokens after putting money into the sale. They were able to watch the number of holders on the token trackers. 

Conventionally speaking, in order to get information on who owns an interest in shares held at Central Securities depositories like the Depositories Trust Company, the investors or the issuers had to take the trouble of contacting the investment banks and brokers who are responsible for coordinating the sale.  Mason Borda, CEO of Tokensoft said:

“I love that investors can purchase and get the tokens directly from the issuer the same day. Over time, as our technology and processes mature, this will all occur in real-time.”

Douglas Borthwick, Chief Marketing Officer and also the head of business development at INX has implied that the sale has seen participation from all walks of the business world and otherwise. It has seen responses and interest from retail, accredited and institutional investors which means that it has been a successful attempt. In the most traditional sense, IPOs were all about carrying out due diligence in a more roundabout manner. The finer details of the IPO are usually kept discreet from public knowledge because of several reasons. 

Yet IPOs are meant to give out information to the public that can help them know more about the company they are about to invest in. The company becomes required to disclose financial, accounting, tax, and other business information. During these disclosures, it may have to publicly reveal secrets and business methods that could help competitors. In the case of INX, being an IPO on-chain has given the public a new way to look at the process and stay with the entire process. 

Any on-chain transaction or a system we are aware of is considered valid when the blockchain is modified to reflect it on the public ledger. So, it gets validated as well as authenticated by a group of participants who are selected and suitable for this purpose. All the details of the said transaction or on-chain activity are recorded on a suitable block. Broadcasting of the requisite information to the whole blockchain network makes it irreversible. 

Now, we had known that INX is self-issuing the IPO with the national exchanges unable to list digital securities. Hence the sale geographical bounds have been restricted. Apparently, the sale is only available in 15 prominent states in the US. But what needs to be noted here is that the sale of tokens is happening to the investors who are located outside.