The exchange, which has come under the scrutiny of the New York Attorney General’s office for allegedly losing access to $850 million that was held by payments processor Crypto Capital, aims to sell 1 billion LEO tokens. More precisely, the sale is being conducted by “a special subsidiary” of iFinex (the operator of Bitfinex and Ethfinex). LEO tokens are priced at 1 USDT apiece.
LEO is described as a utility token to be used on the trading platforms operated by the company. The token will grant its holders reduced fees on these platforms and possibly other benefits as well. In this regard, LEO appears to be similar to other exchange-issued tokens such as BNB and KCS.
Buybacks and token burns
Each month, iFinex and its affiliates plan to spend at least 27% of iFinex’s consolidated gross revenues to buy back LEO tokens from the open market. However, the LEO tokens that are spent by users for paying trading fees can also be counted towards this commitment.
Furthermore, the whitepaper states that up to 95% funds recovered from Crypto Capital will be used to buy and subsequently burn LEO tokens within 18 months of the funds being recovered. Up to 80% of the funds recovered from the 2016 Bitfinex hack will also be used in the same manner.
LEO tokens are currently being sold in a private token sale that will conclude on May 11 (Saturday). If less than 1 billion tokens are sold in this sale, the company plans to sell the remaining tokens, but doesn’t disclose any additional details.
Interestingly enough, the whitepaper also reveals that iFinex is planning to launch a platform for IEOs, with the first token sale being scheduled for June 2019.