While the Nervos token sale has yet to kick off, the offering has already attracted notable attention. Polychain Capital and a Chinese bank have committed significant investments.
The Nervos Token Sale Explained
The Nervos Network token offering will commence October 16th. The sale will last two weeks and aims to raise an undisclosed amount through CoinList.
Already, Polychain Capital has confirmed a $5.7 million investment.
In addition, Hong Kong-based China Merchants Bank International (CMBI)— a wholly owned subsidiary of China Merchants Bank— has committed an undisclosed investment.
CMBI isn’t directly owned by the Chinese government, but rather its top 10 shareholders include seven corporations which are either partially or fully owned by the state.
Nervos project co-founder Kevin Wang told CoinDesk,
“CMBI is a strategic partner, both in terms of financial plans and other types of applications they want to utilize for the blockchain. … We want to make sure they can utilize the infrastructure.”
The upcoming offering won’t be the first time CMBI invested in Nervos. The company also raised $28 million back in 2018, which included investments from CMBI and Sequoia China. The 2018 fundraise was a private sale which included a 14% of the initial token distribution in the latter half of 2019.
Previous reports indicated the Nervos team aimed to build decentralized applications.
In the meantime, Huobi partnered with the Nervos Foundation to build a decentralized finance (DeFi) platform to provide easier capital flows between cryptocurrencies.
The attention that Nervos has received is notable. According to Polychain Capital president Joseph Eagan,
“It’s one of our highest conviction projects, not just in Asia but globally.”
Eagan went on to add,
“I think the ability to create smart contracts similar to Ethereum is very compelling. … From a technological perspective, Nervos and the underlying token offer something truly unique.”
The token sale will be available to retail investors in a number of jurisdictions, but not including the U.S., China, Korea, or Japan. In the U.S., only accredited investors are eligible to participate.
Given the investor requirements, it seems as though the offering could be classified as a Security Token Offering (STO).
Hong Kong itself has previously published guidelines for security tokens, claiming they need to abide by the Securities and Futures Commission’s (SFC) existing securities laws. The SFC has also provided a recent update for digital asset fund managers.
What do you think of Polychain Capital and CMBI investing in Nervos’ upcoming token sale? Let us know what you think in the comments section below.
Image courtesy of Nervos.