Bitfinex will roll out their Initial Exchange Offering [IEO], which is expected to reel-in in a whopping $1 billion. This follows the recent news of the Hong Kong exchange trying to cover up their undisclosed loss of close to $850 million.
According to the exchange’s shareholder Zhao Dong, Bitfinex has formally rolled out its IEO whitepaper. The tokens issued in light of the IEO are titled LEO and would be tabled before private investors prior to public offerings post-May 10.
The exchange has already raised $600 million in private investment, however, the same is not mentioned in the paper and is based on verbal confirmations, added Dong.
Earlier this week, Dong revealed via WeChat that the exchange was in the process of coming out with an IEO. He added that interested parties, if willing to participate in the offering, should reach out to him or DFund.
Unsurprisingly, the exchange launching an IEO at this juncture is due to the New York Attorney General suing the exchange for hiding undisclosed losses and using their held Tether [USDT] reserves to cover up a $850 million loss. The aforementioned sum is frozen and locked in a number of accounts that are under the control of Crypto Capital, a payment processing company.
Despite the speculation, Bitfinex stated that it is “confident that it will retrieve these funds” not specifying that the IEO was the sole way for the same. The exchange added, in the whitepaper, that it is,
“Actively collaborating with the legal investigation and applying to unfreeze these funds through legal procedures.”
In terms of the formalities within the IEO, the whitepaper stated that the tokens would be bought back from hodlers on a monthly system at the prevailing market price.