By Gertrude Chavez-Dreyfuss
NEW YORK (Reuters) - INX Ltd, the blockchain-based global trading platform for digital securities and cryptocurrencies, said on Monday it expects to have raised $125 million in a security token and equity offering.
Proceeds from the first-ever initial public offering of security tokens amounted to $85 million, received from more than 7,200 institutional and retail investors, the company said. That adds to INX's previously closed private token sale of $7.5 million and a pending equity offering in Canada that raised C$39.6 million (roughly US$32.2 million).
INX, a Gibraltar-based company with most of its operations in the United States, in August launched the first security token IPO for both retail and institutional investors approved by the U.S. Securities and Exchange Commission.
Security tokens are digital currencies backed by a tradable asset such as real estate or equity and are subject to federal regulations. The tokens represent a right to the underlying asset.
"There is a very wide range of retail and institutional investors that believe in the idea of blockchain ... that we will see most of financial instruments and financial assets move to trade on the blockchain," INX co-founder and President Shy Datika said in a telephone interview.
"We believe that we will see more and more companies going our way and issuing security tokens, regulated tokens, supervised by regulators. We went through the SEC route, and we will see more regular shares moving to the blockchain," Datika added.
The IPO registration with the SEC could open the path for legal and regulated capital raising and trading for enterprises and early-stage companies through the issuance of security tokens as an alternative to traditional equity offerings.
INX's trading platform is already up and running for the company's investors, friends and family, but it will be made available to the public later this month, Datika said.
The company said it plans to enable both cryptocurrency and security token trading on its platform, as well as capital-raise listings for these digital assets.
(1 U.S. dollar = C$1.2279)