YouNow, a blockchain-based video platform that rewards users for engagements using its cryptocurrency has filed a Reg-A+ offering circular for its Props token with the United States Securities and Exchange Commission (SEC).
What the project seeks is permission from the regulatory body to distribute 178 million units of Props tokens worth roughly ($0.13 per token) to content creators, network transaction validators, and users of its platform.
Unlike other crypto projects caught in the web of the U.S SEC, however, YouNow is not selling the tokens according to the filing but is distributing it as a reward to everyone who has contributed so far to its growth. To be clear, the distribution is in honor of the simple agreement for future tokens (SAFT) framework which the project utilized during its 2017 ICO that raised $20 million.
Thus, the company wrote in its filing,
“No funds will be raised through the public offering, created to allow compliant ‘mining’ of Props in [the] US.”
In explaining the requirements for individuals who it wants to reward with the millions of Props token, another section of the filing with the SEC reads,
“Tokens are to be allocated to users based on their current status (“level”) on YouNow, which signifies the contribution they have made to the network to date. Upon qualification, YouNow users may earn Props Tokens by, for example, creating content on the app. Users hold Props to get in-app benefits and real upside potential.”
As we mentioned earlier, the fundraising model which YouNow has implemented appears compliant with the SEC’s regulation pending approval for the regulators. It thus mitigates the risk of the project coming under a massive enforcement action, an issue that several U.S projects encounter on the journey to completing a token sale.
Meanwhile, we also reported in April that another startup, Blockstack planned to use the same SEC Regulation A+ framework to sell Blockstack’s Stacks (STX) token worth $50 Million.