Why Bit4You’s Crowdfunding Campaign Has Failed

The Belgian platform Bit4You explains the failure of its fundraising by the tumbling crypto market.

Chainius Solutions, Bit4You’s parent company, did not reach its funding target. The fundraising organized by the crowdlending platform Beebonds was supposed to allow Chainius to gather €5 million. However, a few days before the deadline, the counter shows €256,300 of financing. The minimum threshold for the success of the operation, set at €500,000 has not been reached.

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Marc Toledo, co-founder of Bit4You, will not wait for the end of the campaign, set for September 30th, to bury the Chainius fundraising

“It’s a failure. We couldn’t have missed a better operation,” grumbled the entrepreneur. The fault of a particularly badly chosen timing, he analyzes. The operation was launched last May. However, since the beginning of the year, the cryptocurrency market is in full collapse. In November 2021, Bitcoin was peaking at around $68,000. Today, it’s hovering around $20,000. “We were wrong about the market appetite for funding a project in the crypto space. And we were not served by the crypto winter, which hit the market hard.”

With just a few days to go, the counter shows €256,300 in funding. The minimum threshold for the success of the operation, set at €500,000, has not been reached.

To explain the failure of the crowdfunding campaign, Marc Toledo also pointed to the fact that the uncertain economic situation does not encourage investors to take risks. On Beebonds, Chainius is listed alongside real estate projects that are perhaps seen as less risky. “Initially, we offered an interest rate of 8%, the same as for real estate projects. To choose, investors probably opted for more security, and therefore for real estate.” Along the way, Bit4You raised the interest rates to 12% and extended the crowdlending operation by three months. But that wasn’t enough. “You can’t succeed every time,” said Marc Toledo.

The crypto platform Bit4You wants to go public

With this fundraising, Bit4You’s plan was to get its hands on Beluga, a company with very little activity but listed on the stock market. Even if it has fallen by the wayside, the plan is not put back in the drawer. Marc Toledo hopes to convince Beluga’s management to reduce their financial demands. The entrepreneur also hopes to convince his shareholders to participate in a new capital raising in order to support Bit4You’s growth and to start its internationalization.

Marc Toledo claims a record year in 2021, with a transaction volume of more than €1.7 billion, for 28,000 users. In 2022, despite the crypto winter that decreased transactional activity by -70%, Bit4You gained 9,000 users, according to its co-founder.

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(Featured image by Art Rachen via Unsplash)

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First published in L’Echo, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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