Blockstack

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Blockstack
Blockstack logo.png
Founded 2013
Headquarters New York, New York
Key People Muneeb Ali, Co-Founder and CEO; Ryan Shea, Co-Founders
Employees 11-50
Products Decentralized computer network that hosts independent applications
Twitter @blockstack
LinkedIn Profile
Facebook blockstack
Website Blockstack Homepage

Blockstack is a U.S.-based decentralized application platform designed to host open source software applications.

History

Blockstack went through multiple rounds of funding in its early days. In November 2014, a year after it was founded, the company announced a seed round of funding led by Naval Ravikant, CEO of AngelList. Blockstack raised $1,330,000. In 2017, it raised an unknown amount of money through a venture funding round in which the only investor was Rising Tide, a Silicon Valley VC firm. It closed its Series A round, led by Union Square Ventures, in 2017 with $4 million raised. The company also launched an initial coin offering (ICO) in 2017, for which it raised almost $53 million. Investors for this ICO included Union Square Ventures, Naval Ravikant, and Winklevoss Capital.[1][2]

As part of the December 2017 ICO, Blockstack committed to drawing down funds from the issuance only upon meeting certain milestones, as judged by an independent advisory board. Milestone 1 was reached in October 2018 when the Stacks blockchain was launched, unleashing $25 million in funding.[3] In January 2020, the advisory board certified that Milestone 2, which was registration of at least one million verified users, had been achieved. Reaching this milestone unlocked $6.8 million from the original ICO funding.[4]

In October 2019, Binance announced that it would list trading pairs with STX starting October 25, and would begin accepting STX deposits a few days in advance in preparation for trading.[5] The claim of having a million users was controversial.[6]

SEC-approved ICO

The U.S. Securities and Exchange Commission (SEC) approved Blockstack's 2019 offering of $28 million worth of "Stacks Tokens" (STKs) to the public in conformance with the SEC's Regulation A+, which provides an alternative approach to traditional initial public offerings (IPOs). Unlike most IPOs, Stacks Tokens do not provide an equity stake in the issuer, Blockstack. According to co-founder Muneeb Ali, the token had to be built "from scratch," and designed specifically to fit Reg A+ standards.[7] The ICO launched July 11, 2019.[8] Reg A+ offering closed on September 9, 2019.

With more than 4,500 participants in all of its token sales, Blockstack raised $15.5 million from sales of Stacks under Reg A+ and another $7.6 million through a delayed delivery sale of Stacks to Asian customers.[9]

Blockstack launched a pilot program, App Mining, to help stimulate development on its platform in December 2018 by rewarding developers with bitcoin payments. After the SEC's approval of its ICO in July of the next year, Blockstack announced enhancements to the program based on the rankings of the applications produced under the program. Total payouts of their own utility tokens under the program were expected to reach the value equivalent $1,000,000 per month within 10 months. The company developed a system using outside reviewers to rate the applications built on the platform according to criteria like protection afforded to users' data ownership and security, user experience, online reach or distribution, and product launch quality.[10]

The CEO and Co-Founder Muneeb Ali credited the project with helping to increase the number of Blockstack applications from 46 to more than 400. In a blog post on February 10, 2020, Ali announced that the App Mining program would be paused due to a number of challenges in the reward structure that the company believed needed to be addressed. At the time of the announcement, Blockstack said it still had more than 30 million Stacks on hand for incenting application development and it was searching for an independent entity to continue the review and reward program for application development.[11]

Products and services

Blockstack is an online platform for developing decentralized applications, or dApps. Blockstack also created Stacks tokens.

Utility tokens

Stacks, offered through their own website, are utility tokens to be used by developers and their customers.[12] According to Blockstack, Stacks provide the "fuel" for registering transactions on the Blockstack blockchain. Blockstack says that its blockchain will contain very little developer logic, avoids smart-contract design and encourages decentralization of data storage. At the time of the SEC's Stacks Token approval, more than 165 applications had already been built on Blockstack.[13]

Key People

  • Muneeb Ali, Founder
  • Ryan Shea, Founder

References