A Cayman Islands start-up has raised $4 billion, putting behind the world’s biggest initial public offerings on stock exchanges this year. But its flagship product is not even live yet. Block.one is funding its blockchain platform called eos.ios through a process known as an initial coin offering, or ICO. Its multibillion-dollar fundraising effort more than doubles the next biggest offering of that type. But investors still don’t know how the majority of that capital will be used.
Many have been pouring in money based on hype and a promise that its founders, who have run other well-known blockchain projects, can repeat their success. Through the ICO, Block.one is offering a cryptocurrency called eos. Unlike an IPO, which gives investors stock ownership in a company, an ICO gives out tokens whose use case is based on a promise the platform will be useful in a digital network once it gets built.
Participants in the ICO used cryptocurrency ether instead of U.S. dollars in exchange for the new eos tokens. The fundraising brought in 7.12 million in total ether according to Token Report, a division of blockchain advisory firm New Alchemy. The lastest rates are based on the U.S. dollar exchange rate of $576 per ether, the ICO has brought in the equivalent of $4.1 billion. This amount could change depending on the price of ether once the sale closes.