A new initial exchange offering (IEO) token launch platform achieved liftoff last week, starting with a crypto-industry focused social media platform as its first project.
Created by the three-year-old, zero-fee cryptocurrency exchange Digitex, Blockfunder’s first IEO project is Blockster, a fully featured social media platform targeting a very specific community: Crypto enthusiasts and blockchain “hustlers.”
Blockster — the name being a mash-up of blockchain and hustler — claims to be “a groundbreaking social network built just for crypto” that it believes can become “the kind of home base the crypto community is missing.”
The premise is fairly simple: Start by looking at all the places that crypto’s tech-savvy, entrepreneurial enthusiasts gather online — Twitter and Telegram for conversation, Reddit for debate, Bitcointalk for new projects, Medium to share knowledge, and LinkedIn for jobs and hiring — and then roll them all up into one site that does not suffer from the hostility to crypto content and ads seen on mainstream platforms like Facebook.
That will make Blockster “an immersive investment platform that is content-rich and packed with exciting features,” the company says. It will be a place where crypto enthusiasts can find news and opinion pieces from industry experts and thought leaders, follow trending cryptocurrencies and share information on Blockdesk, the social network’s blog, create business pages and groups, advertise their products, and look for jobs or jobseekers — all while following real-time cryptocurrency market data on Blockwatch or learning about crypto on Blockcademy.
“We believe there’s significant value in providing a one-stop shop for socializing, information gathering and project tracking, with the opportunity to generate token-based rewards,” the company said in Blockster’s whitepaper. “Such a platform also enables creators and advertisers to promote their content to a bigger audience, yet one that is still highly specific to the cryptocurrency niche.”
Middlemen can be useful
IEO launch platforms like Blockfunder act, in some ways, like the underwriters that shepherd stock market IPOs from the S-1 filing to the opening bell. To do this, they mine their home exchange’s experience and expertise in a wide variety of ways.
First of all, token launch platforms vet the projects they select, weeding out scams and shaky projects for potential buyers. Crypto startups can also benefit from the technical expertise and marketing of a successful exchange.
In the case of Blockfunder’s first IEO, Blockster, Digitex has designed and developed this promising social network in house from the ground up. However, according to the company, future IEOs will be open to up-and-coming external projects.
MORE INSIGHTS FROM BLOCKSTER HERE
For external projects, Blockfunder will use Digitex’s team of engineers, compliance experts, and marketers to “assess the project’s whitepaper, code, regulatory position, community, team, and potential, and hold new participants to the highest standards before allowing them to hold an IEO on our exchange.”
The token launch platform also does more traditional marketing, including pitching the IEO to Digitex trading clients. Blockfunder also handles the Know Your Customer (KYC) and Anti-Money Launderin (AML) compliance services necessary for the IEO, and provides the technology to manage the sale itself.
Much of any IEO token launch platform’s revenue generally comes from client fees. That said, Blockfunder is selling Blockster’s BXR tokens only for parent Digitex’s DGTX cryptocurrency in three of the six planned sales rounds, including the first. The others will accept Bitcoin, Ether, and USDC.
“We’re really excited to be launching our own IEO platform that will also introduce a new utility for our native DGTX token,” the project said. “As we raise funds for projects, partial payment will be accepted with DGTX, meaning a lot will be collected back from the total circulating supply.”
Today, June 7 at 12pm UTC, phase one launch of BXR will be Blockfunder’s inaugural IEO.
Like many utility tokens, Blockster’s BXR is an Ethereum-standard ERC-20 token that will have a lot of uses on Blockster. It is the only currency accepted when buying ads or NFTs, for tipping other Blocksters, and can be sent to and from community members instantly and free.
Beyond that, BXR holders who use Digitex’s Blockfarm yield farming and staking site receive 20% of monthly ad revenues, and Blockster will burn 5% of the ad revenue it collects every month. There will also be a community governance aspect.
Finally, there are referral programs. During the six-round BXR sale, referrers will receive 10% of the amount of BXR tokens each new buyer acquires. The second and much longer-term program will award five BXR for each friend who signs up using a member’s unique referral link. Blockster has made a significant investment in this program, reserving one million BXR —1% of the total — to fund the referral of 200,000 members.
If that sounds ambitious, the Blockster team already has a pair of highly successful viral referral campaigns under its belt: One that attracted 250,000 emails in two weeks, selling out a $5 million ICO in 17 minutes, and another that collected 1.5 million emails that led to the DGTX token’s price climbing 30x in two months.