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Tether’s ‘new era for capital raises’ Bitfinex bond flops

Validated Media

Bitfinex’s recently launched Tether tokenized bond — hailed as a “new era for capital raises”  —appears to have failed to garner the investment and interest the firm anticipated.

Bitfinex Securities, a platform focused on listing tokenized real-world assets (RWA), announced its first tokenized bond in October, the ALT2611 Tokenized Bond, with the product going live on Nov. 15.

However, after a two-week offer period, only $1.5 million of a $10 million target has been raised, according to the official website.

The target of 100,000 ALT2611 worth 10 million USDT was set for two weeks after launch in the announcement, but it appears to have been extended by another fortnight, with just 15,000 ALT2611, or 15% of the target reached so far.

Screenshot from ALT2611 capital raise. Source: Bitfinex

ALT2611 is a 36-month 10% coupon bond denominated in USDT and issued by Alternative, a Luxembourg-based securitization fund managed by Mikro Kapital.

Tokenized bonds are digital representations of traditional bonds issued on the blockchain, which provides several advantages over their traditional paper counterparts, such as liquidity, accessibility, security, transparency and 24/7 trading.

The minimum initial purchase size was 125,000 USDT, with secondary market trading in denominations of 100 USDT. Moreover, ALT2611 is not offered or made available to American citizens or persons present in the United States.

Crypto trader Novacula Occami commented, “Bitfinex’s first USDT bond issue is a flop,” before adding, “Sorry Paolo, USDT ain’t going to dominate capital markets. BitFinex Securities Kazakhstan isn’t keeping investment bankers up at night.”

However, when it launched, Tether chief technology officer Paolo Ardoino labeled it as a “new era for capital raises” that would see USDT become the “underlying denomination asset of this new financial system.”

The Bitfinex tokenized bond was issued on the Liquid Network, a high throughput Bitcoin sidechain.

Cointelegraph reached out to Bitfinex and Tether for comment but did not receive an immediate response.

In April, Bitfinex Securities received a Digital Asset Service Provider license in El Salvador, which has been looking into issuing its own Bitcoin bonds.

Sovereign dollar bonds in the Central American country have been performing solidly, with a 70% return in 2023 as reported by Cointelegraph in August.


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