Venture Firm Blockchain Capital Planning Initial Coin Offering

Proceeds Will Fund Fintech Startups

Oh Boy! While you turned you back for a moment the horse got out of the stable, jumped a fence and is running wild. Just a few days ago we learned a new hedge fund was issuing its own digital tokens to reward and incentify AI contributors and now a venture firm is going to do an ICO (Initial Coin Offering) to raise money for a fund to invest in fintech startups. Blockchain Capital is looking to raise $50M by partly issuing its own digital tokens. See a trend beginning? This way of raising capital is going to profoundly change capital markets if it continues (say bye bye “penny stocks”)

(Bill Taylor/CEO)

Blockchain Capital, which backs start-ups that use the technology best known for supporting bitcoin, plans to raise a new $50 million fund partly by issuing its own digital tokens, becoming the first venture fund to do so.

The San Francisco-based company seeks to raise a portion of its third blockchain fund through an initial coin offering, or ICO, of tokens and the larger part from traditional venture-capital investors who typically contribute a minimum, Managing Partner Brock Pierce, who is also chairman of the Bitcoin Foundation, said in an interview.

The ICO could take place “in the next month or two,” he said. The company will more fully describe the tokens, which are expected to trade on secondary markets, in an upcoming offering memorandum, which will be issued through TokenHub in about a month. The company is talking with several exchanges but hasn’t confirmed which it will go with.

Up to now, ICOs have been limited to start-up entrepreneurs, who raised about $270 million last year from coin offerings and crowdfunding, according to blockchain researcher Smith & Crown. Their popularity isn’t surprising: Even small investors typically can afford a single coin. Buyers can trade them on secondary markets, instead of sticking around long term…..”

Read Full Article at Business-Standard