Xunlei chief is confident that ban on ICOs can rebuild blockchain’s reputation
Chen Lei insists issue of US-listed, cloud-based content network operator’s own digital token is not an ICO
Xunlei, a US listed technology firm which runs a cloud-based network for digital content delivery, says the digital tokens it has swapped with its users in return for their contribution of idle internet bandwidth should not be perceived as an initial coin offering (ICO), insisting the regulators’ decision to clamp down on the controversial fund raisings is the right move.
Chief executive Chen Lei told South China Morning Post, on the sidelines of the Boao Forum on Hainan Island on Tuesday, that its token – the Linktoken – is not part of an ICO because it’s not traded on any exchanges. Another differentiator is that the company has not raised any funds through its distribution, he added.
The Linktoken was launched in October 2017 as part of the company’s expansion into blockchain. Companies involved in an ICO generally swap their digital currencies for either bitcoin or ethereum, or fiat currencies, and use the proceeds to fund the development of blockchain-related projects.
Nasdaq-listed Xunlei is facing class actions in the US after investors became concerned by its share price decline following the announcement of its foray into blockchain.
