Leading online Swiss bank Swissquote Group Holding SA (SWX:SQN) has announced that it has become the first bank worldwide to offer its clients the opportunity to participate in Initial Coin Offerings (ICOs).
ICOs are a new way for companies to raise money via crowdfunding using blockchain technology. This opens new opportunities for Swissquote clients to become an active part of the story of start-up or scale-up companies and, more generally, to diversify their assets.
Up to now, in order to participate in an ICO, investors needed to understand blockchain technology and own a blockchain wallet. With the new Swissquote service, this is no longer required. Clients can purchase coins (also called “tokens”) issued by a company directly against Swiss francs, using their trading account. Swissquote takes care of the execution as well as of the custody of the tokens.
Swissquote selected the Swiss start-up company LakeDiamond for the first ICO available on its platform. The spin-off of the EPFL (Swiss Federal Institute of Technology in Lausanne) produces high-grade diamonds in laboratories with specialized reactors, for demanding industrial applications such as watch movements, lasers, or transistors.
Via the ICO, the start-up company is selling machine production minutes in the form of tokens. A virtual token corresponds to actual machine time. The tokens are issued following the technical standard used for smart contracts on the Ethereum platform. LakeDiamond is issuing tokens worth 60.5 million Swiss francs in total. The company plans to use the money raised within the ICO to ramp up its production capacities by buying 50 further reactors.
Swissquote CEO Marc Burki said:
True to our philosophy to democratize finance by offering services that are simple and accessible to everyone, we are now offering our clients the opportunity to help grow start-ups. Combining crowdfunding with the blockchain creates a new form of fundraising. Thanks to contributions starting at 33 Swiss francs, clients can participate without being required to invest large sums into venture capital or private equity funds.
Pascal Gallo, CEO of LakeDiamond added:
LakeDiamond has developed and continues to develop its cutting-edge technology combining lab-grown ultra-pure diamonds and high end industrial applications. With its ICO, LakeDiamond is seeking to accelerate its growth and is delighted to be the first company using the new ICO services offered by Swissquote.
Minimum purchase consists of 60 LakeDiamond tokens (LKD) which is equivalent to 33 Swiss francs. During the pre-sale from October 22 to December 11, 2018, there are exclusive advantages offered on the Swissquote platform: Clients will receive one additional free token for each set of ten purchased tokens until 4 million Swiss francs are raised. During the pre-sale as well as during the following public ICO (from mid-January to mid-February 2019), 1 LKD equals CHF 0.55. After the ICO, the conversion rate will fluctuate based on demand for tokens and/or diamonds as well as the performance of the diamond reactors operated by LakeDiamond.