What happens next if an STO is unsuccessful?


  • admin

    What happens next if an STO is unsuccessful?


  • admin

    If the sale reached their soft cap, then they should be good to go. However, what if Security Token Offering failed to achieve its goals? The company will have to decide what to do next. Some projects cancel the sale even before it ends as they see the STO failing. Others let it end by itself, probably hoping for the best.

    Some of the company’s options could be:

    • Returning the investments and closing down
    • Filing for bankruptcy
    • Searching for another company to partner-up with
    • Reorganizing and trying again
    • Trying to move the project with what they collected

    We can look at the Dutch project Blockport. They have failed to reach the STO soft cap of €1 million and filed for bankruptcy. However, they have also started looking for a company or project to collaborate with in order to reopen the company.

    Keep in mind that regulations which the project complies with can protect you from any loses and if the company is not talking about the returns of the investment, the legal approach is possible.