Mark Cuban doesn’t seem worried that initial coin offerings (ICOs) might someday render investors redundant.
In fact, the “Shark Tank” VC is so open to the nascent blockchain use case, that he’s joining the ranks of traditional investors who support the idea that their own portfolio companies could raise additional capital by selling cryptographic tokens.
Revealed exclusively to CoinDesk, Cuban portfolio company Unikrn is currently circulating an update to its investors about a forthcoming ICO intended to supplement the venture capital it has already raised.
Unlike other more tentative investors, which have shown a reluctance to participate directly in the actual token sales, Cuban said he will participate in the offering – a first for the owner of the Dallas Mavericks NBA franchise.
Cuban described the thinking, telling CoinDesk:
“High risk. High reward.”
Founded in 2014, the Seattle-based Unikrn is an e-sports betting platform that has already raised $10m from investors also including Ashton Kutcher, Elisabeth Murdoch and 500 Startups, to let anyone in the world bet with “Unikoins,” the firm’s own digital token, or with fiat money in Australia and the UK.
In the year since the token launched, Unikrn has transacted over 250 million unikoins, according to the company’s founder, Rahul Sood, who tells CoinDesk the plan was always to switch the coin to a more secure cryptographic token.
The 1 billion new tokens – called UnikoinGold – that will eventually be minted will adhere to the ERC-20 ethereum standard and, based on a timeline in the investor update, the formal marketing of the token will begin no later than August. A launch of the live coin integrated with an underlying infrastructure and wallets is set to go live on 31st August.
In addition to demonstrating the increasingly supportive stance taken by traditional investors toward ICOs, this latest development shows another trend of venture backed, non-cryptocurrency startups converting company tokens into cryptocurrency that can be exchanged more widely into ether and ultimately fiat.
Earlier this month, social network Kik announced its own ICO, a development that comes even though it has raised $120m in traditional venture capital.
But Cuban thinks tokens that would be used to fuel online gambling are especially well suited to be converted to cryptocurrency.
“Growth in gambling is going to accelerate,” Cuban told CoinDesk. “Unikrn is better positioned than any other company to leverage that growth not only with their core business , but with blockchain.”
“The ICO opportunity is a perfect fit.”
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