Hong Kong witnessed a cryptocurrency airdrop this month at the TOKEN 20149 annual meet. Coins rained over the investors through balloons in a Mainframe event that creates a unique ICO with real tokens. Instead of distributing the coins digitally in an ICO, the tokens distributed thousands of dollars over crypto enthusiasts.
Mainframe has planned to issue $1 million worth of tokens to raise capital for its secure messaging service. The event was one of the many occasions in which tokens will be airdropped over the crowd of investors.
SEC has been skeptical over the distribution of ICO as it terms as an illegal method of selling securities. As the US authority is seemingly against capital raised through ICO’s, blockchain companies have come up with the idea of selling them for free. Mainframe has taken a step forward by physically distributing the tokens in form of chips instated of circulating them over the internet. Mick Hagen, CEO and founder of Mainframe in an interview with Fortune said, “We are taking it literally. We thought, what if we do a real airdrop?”
The distinct method of ICO distribution was taken positively by investors as they witnessed a new cryptocurrency falling from the sky for the first time. The chips grabbed by people were supposed to be exchanged for codes that are redeemable to gain MFT coins. Mainframe also conducted a pre-sale event for authorized investors and generated $15 million in the form of 27,000 Ethereum.
Are airdrops even legal?
It is still uncertain that the U.S authority and other countries would legalize further airdrops. Mainframe has defended its procedure by stating that balloons were used to eliminate any physical harm to investors by falling chips. Hagen added in her interview, “There were a lot of different logistics to work through. We don’t want anyone to get hurt. We want people to walk away thinking, this was a fun airdrop.”
There have been growing demands to create a new framework for controlling the crypto market. The unfriendly take of SEC and CFTC over virtual currency has been one of the main reasons for the January 2018 decline. It is evident that 80-year-old regulations are not able to handle the new age technology and its growing accessibility.
A U.S based lawyer was quoted in a CoinTelegraph report saying,
“I do think that the Securities Act of 1933 should be amended to properly accommodate token sales and clarify when they should be considered securities offerings. The marketplace needs this as the regulatory uncertainty is paralyzing so many projects.”
Mainframe will be organizing more airdrop events in Beijing, Shanghai, Tokyo and Seoul in the next two weeks. The company has also named it as the “proof of being” in respect to Bitcoin’s “proof of work”.
Interested people who cannot reach the events can also write essays or create video of expressions towards Mainframe to gain some coins known as “Proof of freedom”. The company is not ready to disclose anything about the “proof of heart”.
It will be interesting to see how the upcoming shows perform for Mainframe.