US-based video streaming dating app Whispers Live is looking to raise around $30-45 million through an initial coin offering (ICO).
Whispers, which is in beta mode, said it will offer 10-15 per cent of its 1 billion digital coins, called RoseCoin, each at 0.001 Ethereum, which is currently priced at $300. The transaction is expected to take place on October 1, 2017.
The company will initially issue 10 per cent coins through a public crowdsale and continue to sell another 5 per cent at a 30 per cent premium if the 100,000 Ethereum target for the first tranche is reached.
A portion of 50 per cent is reserved for a user growth pool, 10 per cent of which will be allocated to pre-sale period via private transactions. The remaining coins are allotted to Board of Advisors, future employee retention program, team members, contributors and partners.
RoseCoin is used as a token of appreciation within the app for tipping video hosts. In the future, the company aims to make the token a general gift exchanging platform for other online dating and live-streaming businesses.
Whispers’ system allows real-time, one-on-one video chatting, where users (callers) pay for the services with a credit card and tip the hosts (callees) with RoseCoin or fiat currencies, while the hosts can set their own rate for the video chat and earn money for each minute hosting the call.
RoseCoin is implemented as an Ethereum-based token on the Ethereum blockchain. However, the company may move the digital coin to another blockchain if market conditions allow, or even build its own blockchain if all public platforms become fertile.
“We expect to accept RoseCoin as a form of payment for hosts’ time when RoseCoin becomes tradable on exchanges, after the ICO, and when our dating social network is of critical and globally scalable size.”
Following the ICO, Whispers aims to expand to North America and Australia in the first quarter of 2018, then Southeast Asia and Africa in the next quarter.
“We believe the cryptocurrency holders can be a natural fit to be active users of Whispers Live,” Charles Thach, co-founder and CEO of the startup, told DEALSTREETASIA in an interaction.
He said the firm recognises the risks of this unregulated market, adding that ICO risks “vary so much in nature”, ranging from considerations whether it is a form of project financing, equity financing, debt financing, combination or derivatives.
Most ICOs currently do not have a working prototype, and regulators in parts of the world, particularly the US Securities and Exchange Commission (SEC), have started to see cryptocurrencies through a new lens to protect investors amid the frenzy.
Some nations, like Japan, have adopted digital currencies as a legal payment method. Asia might be an easy playground for startups like Whispers to enter, as Singapore, Southeast Asia’s financial hub, recently joined the fray to consider legalising ICOs.
Blockchain enthusiasts are tapping ICOs to raise funds, with around $1.2 billion token sales from the beginning of this year until July 25, according to Autonomous Research.