Bitfinex's Tether Tokenized Bond Falls Short, Raises Only 15% of Targeted $10 Million
Summary:
Bitfinex's Tether (USDT) tokenized bond failed to attract the expected interest, having raised only $1.5 million against a $10 million target within a fortnight of going live. Despite extending the offer period, the total only reached 15% of the intended amount. Tether's CTO, Paolo Ardoino, initially predicted the bond would herald a new era in capital raises. The bond was listed on the Liquid Network and remains unavailable to US citizens or persons in the U.S. Bitfinex and Tether have yet to comment on the matter.
Despite the high expectations set by Bitfinex for its Tether (USDT) tokenized bond, the investment project didn't receive as much interest and investment as predicted. Bitfinex Securities, an entity dealing with tokenized real-world assets, unveiled its first tokenized bond, known as ALT2611, in October. The product became operational on the 15th of November. However, the $10 million fundraising target fell short; only $1.5 million was gathered during the two-week offering period as per the company's official website. Another fortnight was added to the offer period after only 15% of the 10-million-USDT target was achieved.
The ALT2611 tokenized bond is a three-year bond with a 10% coupon, denominated in USDT. This bond, launched by alternative securitization fund based in Luxembourg and managed by Mikro Kapital, is a digitized format of traditional bonds via blockchain technology. This technology allows for higher liquidity, improved accessibility and security, transparency, and round-the-clock trading. An initial purchase of 125,000 USDT was set, and secondary market trading was done in 100 USDT denominations. However, the ALT2611 is not accessible or offered to U.S. citizens or persons in the U.S.
Crypto trader Novacula Occami commented negatively on the bond's performance, despite initial positive perceptions by Tether's chief technology officer Paolo Ardoino. Ardoino had previously claimed that USDT would become a major asset in the new financial system.
The tokenized bond was launched on the Liquid Network, a leading Bitcoin sidechain. Bitfinex and Tether were contacted for comments but didn't immediately respond. Meanwhile, Bitfinex Securities was granted a Digital Asset Service Provider license in El Salvador in April to issue their own Bitcoin bonds. This coincided with a time when sovereign dollar bonds in the Central American country were performing well, yielding a 70% return in 2023 as reported in August.
Published At
11/29/2023 4:26:07 AM
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