Ideas

Brainiac

This digital currency has ‘no purpose,’ so of course investors love it

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What is it? A digital currency with “no purpose”

Innovator: Software company block.one

What were they thinking? There’s a certain elusive quality to digital currencies such as Bitcoin, which made headlines in recent months as it surged in value. For the unitiated, it’s not entirely clear what digital currency is. But block.one is taking opacity to a new level. Founded last year and registered in the Cayman Islands, the firm is raising money by selling digital tokens called EOS, and not even investors can claim they fully understand what they’re buying. They’re required to sign a purchase agreement stating the tokens “do not have any rights, uses, purpose, attributes, functionalities or features.”

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Did it work? While the fine print explicitly says “no purpose,” the disclaimer has not been much of a deterrent. Block.one has raised $700 million and counting, according to The Wall Street Journal, a haul larger than all but 10 of the 195 US initial public offerings this year.