Colu DLT, the Gibraltar based subsidiary company of the Colu Group, becomes one of the first companies to voluntarily offer to purchase the entirety of tokens sold during an ICO, as blockchain project concludes. The Colu Group has seen the recent growth in partnerships with municipalities across the world, and it continues to implement its vision of helping strengthen communities and cities by focusing on municipalities and city partners, rather than building local community blockchain platform.
Colu DLT has announced that it will voluntarily offer to purchase the CLN tokens it issued last year from ICO purchasers and other token holders. Colu cited its sense of responsibility towards token holders, including those who participated in the token sale. In recent months, the Colu Group has seen extensive growth in its work with municipalities across the globe, including significant opportunities which it wishes to pursue. However, the CLN platform which Colu DLT had been developing and supporting poses both regulatory and technical challenges to this work. Colu Group has decided to align its operations accordingly.
Speaking about the decision to conclude the CLN project and the offer to purchase the CLN tokens from their holders, Colu DLT’s Chairman of the Board of Directors and co-founder of the Colu Group, Amos Meiri said: “We have always worked to enrich communities and help cities grow, using innovative tools. That vision remains unchanged. As a technology which inherently builds trust between people, we believe that blockchain may yet help to achieve this in the future. That is why we initially issued the CLN tokens and invested in developing a platform, which we envisaged would support a network of local cryptocurrencies.
“However, at this stage, the lack of clear regulatory guidelines in the regions where the Colu Group wishes to operate, makes the use of cryptocurrencies a barrier towards working with municipalities and other partners, which have become the main focus of our work. The Colu Group has developed and operates non-crypto electronic wallets, which include an in-app rewards scheme. Centered around a city currency, this rewards platform helps achieve economic, social, and environmental city goals.”
In recent months, the Colu Group has announced the introduction of the Belfast Coin, in partnership with Belfast City Council. It will be used to reward residents for shopping at local businesses, healthy living, civic activity, and more. Meanwhile, The Colu Group has also launched a partnership with the Municipality of Tel Aviv-Yafo. TLV Coins reward residents for strengthening local businesses through the Colu app. In addition, money is being raised for local NGOs to strengthen the local community further. Neither scheme is currently based on blockchain technology. The Colu Group is also in talks with a number of other municipalities across the world, about introducing similar initiatives.
Meiri continued: “CLN token holders placed their trust in us and became partners in building a blockchain platform. Now that we are no longer proceeding with that platform, I believe that we have an ethical responsibility towards these same partners. That is why we have taken the decision to make an offer for the purchase of the CLN tokens to all current holders on favorable terms in comparison to the current market value.”
Colu DLT has already received support for the move from all its largest CLN purchasers from the original presale, which accounted for more than $17M. As a one-time act, the company will now look to acquire the entirety of tokens as issued during the ICO crowd sale period or purchased on the secondary market, amounting to approximately 54 million tokens. Colu DLT will purchase the tokens in Ethereum, in line with the issuance arrangements during the ICO, at the original crowd-sale ETH to CLN rate, which is higher than the current market exchange ratio. Once the process is completed, Colu DLT will ‘burn’ the tokens purchased, rendering them worthless.
The purchase process, which is expected to commence in October, will take place via a dedicated website. CLN token holders looking to accept the offer will be subject to routine KYC (know your customer) and AML (anti-money laundering) checks. Only individuals who complete the KYC and AML processes will receive payment for their CLN tokens. The purchase period will be open for ninety days. Colu reserves the right to extend the period, should circumstances change. The purchase from the general public is closed to and not intended to include any potential sellers from the USA and certain other jurisdictions, which were also restricted from participation in the original ICO.
World-renowned behavioral economist, Prof. Dan Ariely, Advisor to the Colu Group, said: “Colu DLT’s decision to purchase CLN tokens appears unprecedented in the industry. It demonstrates how the Colu Group’s core values guide its actions. The Colu Group is focused on fostering relations between municipalities, local businesses, residents, and other city stakeholders. These relationships rely on the very same kind of trust and consideration, which is now being shown towards CLN token holders. It is wonderful to see the Colu Group following their ethical standards not just in words but in action. Such acts of giving up profits for the benefits of customers, partners, and investors are crucial to this tech sector if we want it to continue to evolve and grow.”