Poloniex unveiled its upcoming Tron (TRX) powered initial exchange offering (IEO) platform on April 5.
Projects wishing to implement their offering on Poloniex’s LaunchBase platform are faced with the requirement to issue tokens in exchange for TRX, and are being considered on a “first come, first served” basis.
Poloniex claims that LaunchBase is “to help grow high-quality blockchain projects and further develop their ecosystem,” and states that it will “provide professional advice and guidance” to support partner projects.
In addition to agreeing to raise funds in TRX, partner projects will be subject to “eligibility and screening requirements”. Entities located in “certain jurisdictions” may not be eligible due to legal considerations.
Poloniex states that more details about LaunchBase will be announced in the coming days.
The first project planned to run an IEO with Poloniex is a Tron-based stablecoin lending platform called Just (JST).
Just is a decentralized lending platform where users can deploy TRX to generate the USDJ stablecoin – which can be used to pay interest, maintenance and other activities.
On Twitter, Tron founder Justin Sun described how to build a decentralized financial (DeFi) credit and governance protocol.
Sun was part of a consortium of Asian investors who bought Poloniex in October 2019. Poloniex is the 15th largest crypto exchange by volume.
IEOs have emerged as an alternative to initial coin offerings (ICOs) where the issuing exchange deals with considerations including regulation, marketing and market making in exchange for a significant portion of the token distribution.
Many projects launched through Binance’s Launchpad platform have been criticized for their token allocation assignments and centralization.
Only 19% of Matic Network’s (MATIC) total offering was allocated for distribution through its IEO on Launchpad. 11 months after the IEO, the top 100 MATIC portfolios made up 98.62% of the offering.
Harmony (ONE) launched on the platform the following month, spending only 12.5% of total sales to the public. Today, 99.47% of Harmony inventory is held in two wallets.
In July 2019, Wink (WIN) spent only 5% of its offering through Launchpad IEO.
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