The New York-based blockchain software provider, Blockstack has announced that it intends to raise $50 million in a token sale that would leverage the SEC’s Regulation A+ crowdfunding exemption. It is to be noted that Blockcstack was launched in 2017 for creating the infrastructure for a decentralized internet.
Interestingly, the sale would enable Blockstack to raise capital through the U.S. securities markets by means of a subsidiary, Blockstack Token LLC. The subsidiary would sell a token called Blockstack Stacks in securities offering designed to be more adjustable than an Initial Public Offering. Nonetheless, the move still needs regulatory review.
Captivatingly, the Regulation A+ exemption enables equity crowdfunding campaigns to offer and sell securities to U.S. investors by means of 2 tiers, either for $20 million or $50 million, each over a twelve-month period. Regulation A+ exemption was introduced in 2012 under the JOBS Act.
In entirety, two hundred and ninety-five million STX tokens will be offered at a price of $0.30 each.
The company mentioned in a press release that the net proceeds of the offering will be used to accelerate the development of its app ecosystem and decentralized computing stack.
It is to be noted that the move is in accordance with past sentiments voiced by founders of the New York-based company. Interestingly, the founders of the company, in late 2017, were critical of token sales to private investors. At that time, they argued that they did not facilitate an adequate amount of diverse participants to generate a truly decentralized software network.
Still, the company has been forced to walk back its ambitions given the U.S. regulatory environment, raising $50 million through a sale of 440 million tokens in December of that year.
Notably, the investors at the time included Foundation Capital, Union Square Ventures, Blockchain Capital, and Winklevoss Capital among others. Also, more than eight hundred people were said to take part in the sale.