Bitfinex announced today its first foray into the increasingly popular business of initial exchange offerings (IEOs).
A new Bitfinex service called Tokinex will announce its first token launch this Thursday, followed by the debut of a second token on June 13.
“What it means to be an exchange has evolved alongside the maturing crypto market. It has become an entire ecosystem, not just limited to the remit of trading digital assets,” said Jean Louis van der Velde, CEO of Bitfinex and Ethfinex.
Bitfinex follows other major exchanges like OKCoin, KuCoin and Binance into this new line of business. Thus far there have been several advantages to fundraising with an IEO over an initial coin offering (ICO). Most notably, the arrangement usually comes with a commitment from the exchange to handle all Know Your Customer (KYC) and Anti-Money Laundering (AML) checks on a startup’s behalf. IEOs also usually come with a commitment by the exchange to promote the offering to its pool of customers.
These services usually are contingent on hefty fees, but startups approved to run on Tokinex will face no upfront costs and, after successfully completing fundraising, the token will become listed on both Bitfinex and Ethfinex, according to company officials.
Participants will register through the Tokinex site where they will receive KYC checks from Blockpass, research materials on offerings and settlements through their existing exchange wallet.
A Bitfinex spokesperson told CoinDesk users will not be charged fees to access these sales. “You also don’t need to hold any exchange tokens to participate,” they said.
Update (May 21, 13:58 UTC): Following publication, Bitfinex replied to a request for comment about user participation costs. The article has been updated with that information.
Bitfinex image via Shutterstock
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