The news that Renren, a social network based in China, is going down the ICO route to raise money has been a blessing, as its shares have recorded a 47% spike since the reports surfaced. According to the company’s white paper that was released on Tuesday, the plans to launch an ICO are already in place and their native token will be known as RRCoin (a blockchain-based open social network platform).
Headquartered in China, Renren is listed on major stock exchanges, including the New York Stock Exchange. The reports about launching an ICO saw its stock rise by 47.39% to reach $18.32 per share by Wednesday, the close of the trading session in the US.
Startups Bagging Millions Through ICOs
Renren isn’t the only company looking to launch an ICO in order to raise funds to make their project a reality. We have seen many companies reportedly taking that path too, in a bid to introduce their product into the market or improve upon an existing one.
In 2017, the majority of startups collected hundreds of thousands of dollars through ICOs, with reports showing that billions of dollars were invested. However, there were also a number of fraudulent ICOs that were out there to dupe unsuspecting customers. But to bring sanity to the industry, regulators are reportedly looking for ways to crack down on frauds. In September 2017, regulators in China moved to ban ICOs, claiming that the practice was marred by illegal activities as well as financial scams.
Why are company stock prices soaring following reports that they are involved with blockchain technology and cryptocurrencies? Are these industries the future of businesses? Let’s hear your thoughts in the comments below.