New York-based CG Blockchain, which is developing blockchain-based tools and services for the financial services sector, has revealed that its affiliate, BCT Inc., has closed the online public sale of its BCT “ERC20-compliant” utility token and raised over $25 million. It comes despite recent turbulence for initial coin offerings (ICOs).
It is understood that the purchasers for these utility tokens, which are based on a standard and describe the functions and events that an Ethereum token contract has to implement, comprise “a blend of traditional cryptocurrency, institutional and accredited friends and family that span 42 countries” according to Bob Bonomo, president of CG Blockchain in the Big Apple.
The fundraising development follows FactSet, a global provider of integrated financial information and analytical applications, announcing early this February a strategic relationship with CG Blockchain around providing trade order and execution management with blockchain.
By virtue of forging their relationship, FactSet clients were to have access to CG Blockchain’s products via its BCT Fundstore. And, CG Blockchain’s current and future clients would also use FactSet’s Portware execution and order management capabilities, delivered as FactSet OEMS, for trade execution, analysis, order generation and compliance efforts.
For its part, BCT offers a suite of proprietary and third-party application tools for hedge funds, wealth management enterprises, and other institutional traders to trade cryptocurrency through its Blockchain Terminal. This touts a single, integrated interface for trading cryptocurrency across four major cryptocurrency exchanges (Bitfinex, Bitstamp, Kraken and Poloniex) and a consolidated view of around 90 exchanges.
Bonomo, an alumnus of Columbia University from The Fu Foundation School of Engineering and Applied Science, commenting in relation to developments by the firm to date explained: “Over the course of the past two months, the Blockchain Terminal has hit milestone after milestone and grown to reach over 90 exchanges on the platform.”
He added: “Our goal is to provide the first complete view of the crypto marketplace within a single order book. Furthermore, we are also empowering our clients with the ability to trade across as many major exchanges as possible without sacrificing execution quality.”
Among the third-party applications planned for the Blockchain Terminal is ComplianceGuard, which is described as the “first software” developed to monitor traders’ desktops whilst simultaneously writing all transactions to a private blockchain, and thereby rendering the transactions record immutable.
Both the Blockchain Terminal and ComplianceGuard are currently in development with a select group of traders and hedge funds, which collectively have approximately $1.8 billion in assets under management (AUM).
“We have expanded as our suite has grown and our longer- term goal is to incorporate around 200 of the world’s top exchanges,” Bonomo pointed out. This, he said, “Will allow Blockchain Terminal users to potentially take advantage of certain third-party applications anticipated to be included on the Terminal to become market makers and liquidity drivers in a new crypto economic landscape.”
Specifically, the Blockchain Terminal now features a User Interface (UI) and provides a User Experience (UX) that is easy to navigate, as well as a consolidated order book claimed to be “much easier to use” than any other platform the market has hitherto seen.
With Bonomo asserting that there is “much more to come” in terms of developments, and with the Blockchain Terminal having been “shipped to domestic and international partners in both crypto and traditional trading”, CG Blockchain and its associated companies are also actively collaborating with software companies and algorithm marketplaces to test additional features for the Terminal.
Joel Emery of Tareo Capital, an advisor to CG Blockchain as well as a Blockchain Terminal tester, stated: “To have achieved what the team at BCT Inc has managed to do during such a difficult time for the ICO market is extraordinary. And, I believe that when the Blockchain Terminal it is adopted widely it will change the way the market operates.” Of course, time and market take-up will be the test of this.
Commenting in relation to how the market could operate in future, Emery ventured: “The crypto market will have to balance the burning man element of decentralization with the needs of an institutional investor to increase the size of the capital invested in the sector. This will be beneficial for all.”
He added: “The mainstream fundamental question that investors dismissing crypto do not understand is that the crypto ecosystem is multi-dimensional.”
The BCT utility token is the primary token powering the Blockchain Terminal ledger. The Blockchain Terminal also includes a secondary ERC20-compliant token, available since the platform’s launch, which represents subscription and entitlement to the services provided by the native BCT token.
Together, the two tokens secure integrity and provide incentives for the “correct functioning” of the Blockchain Terminal platform, it is explained.
CG Blockchain’s Bonomo remarking on the market conditions facing the fund raising, said: “Given the current turbulence of the ICO market, we could not be happier about the response to the BCT Inc token. [But] as impressive as that effort is, we still have much work ahead, from finding additional partners to token distribution to continuing to build out the top crypto-focused resource for hedge funds and other investors.”
Elaborating further on what could stabilize things going forward for the ICO market, he posited: “While we certainly welcome the stability that clear regulatory guidance will provide to the industry, markets also stabilize as liquidity and overall trading volumes rise.”
He added: “By introducing institutional participants to this market with the tools to facilitate regulatory compliance, we hope to significantly grow the market and drive long-term stability.” Given that the crypto market is still young and growing fast, Bonomo further acknowledged that is there is “absolutely uncertainty about its future.”
Indeed, as Charles Hoskinson, a former co-founder of Ethereum and currently CEO and co-founder of IOHK, an engineering firm that builds cryptocurrencies and blockchains for academic institutions, government entities and corporations, told me last week in Tel Aviv at the EUROCRYPT 2018, the 37th annual international conference on the theory and applications of cryptographic techniques, we cannot discount “further volatility” in this fast moving industry.
That said, Bonomo asserted: “The combination of increased investment, institutional analysis and regulatory guidelines would constitute a meaningful step towards reaching the standards of other asset classes and their associated stability.”
And, clearly having a few million dollars in your war chest to fully develop blockchain-based trading with enhanced UI and UX together with a consolidated order book that is easier to use should help matters.