Welcome to the world of Initial Coin offerings (ICO), the instrument that has made billions for companies such as Block.one – the creators of EOS. Almost all ICOs are raising atleast a few million USD.
Some ICOs made investors filthy rich but some ICOs have duped a lot of investor money and made anonymous scammers filthy rich as well. Some notable ICO exit scams being PlexCoin, Giza Token, Benebit, etc.
Initial coin offering is an unregulated means by which funds are raised for a new cryptocurrency venture. In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for fiat or other cryptocurrencies like Bitcoin and Ethereum. Strictly speaking, most ICOs are not offering coins, but they are offering tokens on existing blockchains like ERC20 on ETH network or NEP5 on Neo. The real name for ICO in such a case should TDE – Token distribution event or something like that.
Enough of the introduction. Let us talk about ICOs taking place in India. By India, I don’t necessarily mean by a company registered in India, but by anyone who has vested interest in India. A company that geographically operated in India for most its time or an Indian company that decided to do an ICO by registering into a crypto friendly country.
The focus is on exchanges, the ones that were to be opened, or opened and operated in India and are now raising funds for a global product.
Indian Exchanges going “Global”
Couple of Indian exchanges are running an ICO at the time of this writing to launch a “global exchange”. BuyUcoin and Ethx.in are two of them. One exchange BitIndia did an ICO in 2017. We will get to that in a bit.
BuyUcoin is a veteran cryptocurrency exchange in India. According to their own website BuyUcoin was founded in 2016 as a Bitcoin exchange with Credit card payment facility. In March 2017, BuyUcoin had acquired 15000 users and in September of the same year BuyUcoin launched multiple cryptocurrency exchange. The founders of the exchange are Shivam Thakral, Devesh Aggrawal, and Atulya Bhatt.
After the regulatory hurdle in form of a virtual ban on crypto-fiat trading that RBI announced in April this year, BuyUcoin launched its ICO – to launch a global exchange. There is no whitepaper though.
BuyUcoin’s BUC token is built on NEM blockchain. The total supply is 100 million and 10 million of these tokens are out for sale in the ICO. At the time of this writing roughly 2.9 million tokens remain unsold. That means BuyUcoin holds 93% of the ICO tokens.
The purpose of the token is to get discount on fees in the global exchange and also as a trading pair for other cryptocurrencies.
Ethx.in Becomes Ethx.co
The Mohit Madan and Tarusha Mittal co-founded exchange ethx.in listed ETH, one and only cryptocurrency for trading until March, 2018 when they added Bitcoin and Litecoin to the trading bucket. Today ethx.in redirects you to ethx.co, a website for the ICO of a global cryptocurrency exchange.
Ethx.co is now registered in the UK and is running a Pre-ICO sale that ends today. The whitepaper says Ethx.in was a closed beta product with 35000 registered users and 100k waitlisted users. After the fund-raising, Ethx will launch a global crypto exchange supporting fiat based transactions as well.
Additionally, the company will develop blockchain products like Ethx datablock that will allow users to rent out space from their devices in return for cryptocurrencies. Another product Ethx Ninja, a security suite for enterprises to fix their security vulnerabilities. Ethx also boasts of offering merchant services and point of sales that allow crypto payments.
The ETHX token is an ERC20 token on the Ethereum network. The total supply is capped at 100 Million, 40 Million of which will be distributed in the ICO.
The History of Exchange ICO by BitIndia
You must have heard it in the news. Bitindia is now Blockonix. BitIndia is an Indian to-be launched exchange that did an ICO to launch the exchange in 2017. From mid 2017 to May 2018, there is not a single product that BitIndia released for the general public. John McAfee is one of the Advisor of BitIndia.
A whopping 94.39% of tokens were burned after the ICO as they remained unsold. From the planned 180 Million tokens, only seven and half were in circulation. A BDT token was introduced for Blockonix which required users to swap their Bitindia tokens to Blockonix tokens (BDT). The BDT token has Zero Value on Ethereum blockchain.
Coming to the product, after the RBI’s decree BitIndia announced that they are rebranding to Blockonix and are launching a global Cryptocurrency exchange registered in Malta. It made it to the news, many sites reported it. That’s when I started looking into it.
BitIndia’s Alpha App
BitIndia’s youtube channel shared a bunch of videos on the future of their app, exchange and wallet. A video launched seven months ago shared details on how to use BitIndia’s alpha Wallet version 1.
A second video released two months later talked about BitIndia’s alpha Wallet version 2 which is nothing different than the version 1. I still haven’t found the alpha wallet. It is an Ethereum wallet app, it isn’t even an exchange.
Current BitIndia/Blockonix Status
The blockonix website today has an exchange-like homepage. I registered. Activated the account by clicking on the link in the email and tried to login again. INVALID USER. I got this error 5 times before I stopped trying.
This is the image of the homepage. Count the number of Zeros in the page.
I am not sure where Blockonix is as of now. I would normally contact the team for an update but this article is not about them. Maybe they will launch a great exchange for the global market, eventually. As of now, almost a year after their ICO, we see no tangible progress except videos and websites.
Should you invest in an Indian Exchange ICO?
The million dollar question is, should you invest in these ICOs? The answer is the same that you would get for any other ICO. Do your own research.
If you want to make money, bad ICOs can do that for you as well. But if you are truly looking forward to invest in a project that can bring value to you, research is what you must do.
- Are the exchanges going to provide anything that the existing exchanges do not provide?
- Does the product solve any real world challenges?
- Do they have a good team and advisors behind the wheel?
- Is the product sustainable?
These are some questions you can ask. I wouldn’t make the mistake of investing in Giza. The project looked promising, but I made the mistake of not doing background checks on the team and it turned out to be an exit scam. You should not make a similar mistake.
At the end of the day it is a cryptocurrency exchange. Zebpay is running a multi million dollar business with investor money – no ICO. Koinex, Coindelta, Coindcx, Unocoin and many more exchanges in India are running successful exchanges as well, without an ICO.
What do you think about investing in ICOs by Indian Exchanges? Let us know in the comments below