Mozilla co-founder Brendan Eich’s project Brave, a Blockchain-based web browser ripped through their initial coin offering (ICO) today that has redefined the concept of speed in terms of token sales.
The ERC-20 compliant coin called the Basic Attention Token (BAT) sucked in $35 million in less than a few blocks… the ICO started funding at block 3798640 and accepted its last deposit at 3798642. They raised $36 million and it was all over in under 30 seconds.
Allegedly only 184 were able to buy in with a few people dropping in significant ETH to hit the cap within seconds. With less than 200 wallets controlling the supply, including a small number whales who purchased over 5 percent of the total supply each according to reports at Reddit.
Remember that while events like these may be exciting (and highly profitable for the 192 investors that got in), it brings increased regulatory pressure.
Example: A U.S. Securities and Exchange Commission OFFICIAL SAID ON TUESDAY, “If you want this industry to flourish, protection of investors should be at the forefront … At the SEC, we like to facilitate capital-raising, but at the same time, we want to ensure a fair market”
Objectively, speaking this was the furthest thing from a fair and balanced market. Yes, everyone had the opportunity to attempt investing at the same time, but people with large amounts of ETH (think: 3,000+) purchasing significant percentages of the supply and selling out one of the largest crowdfunding campaigns in history within seconds is in no way balanced.
Building community is a key part of successful post-ICO projects and with so few buyers this could actually be problematic rather than beneficial, if they want people to use the browser.
Commenters at Bitcoin talk were complaining about a influx of Bitcoin whales accusing that four people bought 40 percent of the supply and they started to sell off immediatly as it become tradeable on the exchanges for 10x ICO price.
It appears that some shelled out thousands of dollars in transaction fees to cut the line, according to Ethereum co-founder Vitalik Buterin on Twitter:
https://t.co/oiFGyh1iju This is a $2220 tx fee, used to cut in line in BAT ICO. “Ethereum avg txfee $1” statistics include stuff like this.
— Vitalik Buterin (@VitalikButerin) May 31, 2017
Well it’s not going to get easier for the ‘small guy’ to get a piece of the action as it did 24 hours ago. And what lies in the future for ICOs when the Whales and the incoming institutional investors come in with deep pockets and simply cut the cue remains to be seen. There’s some irony in cryptoanarchists (who make up a fair size of the cryptocommunity) complaining about lack of rules when it comes down to letting the free markets freely enriching the rich.