Video streaming platform YouNow has filed a circular with the U.S. Securities and Exchange Commission (SEC) ahead of plans to distribute its Props token through a public offering.
Reuters reported the company is not intending to raise capital from the issue, but instead to offer its tokens to those that have contributed to creating the platform and its content, spanning potentially millions of individuals.
The tokens will be issued on a continuous basis under the proposals. The circular has been filed through the SEC’s Regulation A+ exemption, with a total of 178 million tokens to be distributed, should the plans gain the approval of the regulator.
Under the Regulation A+ exemption, companies can sell securities to investors within two tiers, of $20 million and $50 million respectively, over a single year. Securities can be sold to the general public as well as accredited investors, as is the case with IPOs.
YouNow founder and CEO Adi Sideman told Reuters Props tokens would allow users to be rewarded for their contributions to the YouNow community:
“Those users — they may be content creators, moderators, or they may be supporting the system financially — that help grow the network can now be rewarded in a transparent and mathematical way through cryptocurrency.”
David Pakman, partner at investors Venrock, said the regulatory approval will allow app communities to integrate legally compliant digital tokens.
“Over the past two years the team focused on launching Props in a manner compliant with US regulators and now, pending final approval by the SEC, there is the opportunity for apps to integrate and ‘mine’ a legally compliant digital token and obtain a stake,