Security Token Offerings are a fundraising channel through blockchain transactions but backed by real assets. In the case of the TradeCloud Tokens, they have utility and security features.
The digital metals trading platform has set the new offering to run for three months and expects it to raise €13.3 million ($15 million). The company already completed a private round of €4.4 million ($5 million) over a one-month period ending on Thursday.
“The principal reason to raise funding through a Security Token Offering, compared to the traditional venture capital route, was to allow customers to participate in the future of TradeCloud. We hope that over time the tokens will be held by TradeCloud customers. They can then spend them on services on the platform or hold them for long-term profit share,” chief executive Simon Collins told Fastmarkets.
The company said that a successful offering will raise enough funds to allow the global development and promotion of TradeCloud for at least the next three years. Currently, the company has nearly 500 users from across 35 countries. Over $1 billion worth of trades have been initiated on the platform.
Most businesses carried out through TradeCloud are related to refined metals, and are mostly done in Europe and Asia, but the company expects to expand its market to Latin America, North America, India and the Middle East after raising the funds.
Token holders will be able to access services including digital documents and subscriptions to the TradeCloud platform, both features to be introduced once the money is raised.
The money will be spent on marketing, the expansion of its commodity offering and the development of new connected services through the TradeCloud Commodities Web.
Buyers and sellers of base metals doing business through TradeCloud have the option to anonymously submit trade data to Fastmarkets when doing so.