Huobi Offers Platform Utility Token, ‘Not An ICO’
Former exchange Huobi announces token creation for platform utility.
Huobi, the cryptocurrency exchange, has announced that they will issue a token (the ‘Huobi Token’ or HT) starting January 23. The offering will be capped at 500 million tokens, of which 300 million will be offered to investors and the remainder kept as user incentives or team rewards.
The offering, though, is not to be understood as an ICO, with the Huobi press release indicating that only users who are actively participating in the platform can receive HT.
“HT is not an initial coin offering (ICO). Users can only get HT by purchasing 'Point Card' on Huobi Pro. Point Card is Huobi's pre-paid card for basic service charge. 1 point = 1 USDT.”
The announcement also indicates that the company will devote 20% of profits each year to a buyback program to bring the HT off the market. By structuring utilities on the network this way, the company will be able to collect fees in advance and maintain customer loyalty over the long haul.
"For example, if you purchase the 1,000 HT package, it will only cost USDT 990, and you will get 1,000 HT for free. HT can be used for offsetting the trading fees.”
The token offering is the latest attempt by the company to restructure their business model after the Chinese regulations regarding exchanges and ICOs.