TLDR
- Backpack Exchange will allow users who stake its token for over a year to exchange those tokens for company shares.
- 20% of Backpack’s equity has been reserved for token stakers.
- 62.5% of the tokens will first go to users, and the allocations for the team and investors will come after a possible IPO.
- The company is in discussions to raise $50 million at a valuation of $1 billion.
- CEO Armani Ferrante, a former employee of Alameda Research, states that the model is designed to avoid the “false promises” of previous token launches.
The cryptocurrency trading platform Backpack Exchange has declared that users who stake its upcoming token for at least one year can exchange those tokens for equity in the company.
CEO Armani Ferrante made this announcement on X on Monday. He mentioned that 20% of the company’s current equity has been set aside for this program.
I didn’t enter the crypto space 9 years ago to launch a worthless coin.
I didn’t get into crypto to get rich quickly.
I got into crypto because I believe it will change the world, and that the industry is worth devoting my life to.
But somewhere along the way, amidst…
— Armani Ferrante (@armaniferrante)
This move is taking place as Backpack is working towards a potential IPO in the US. The company has not yet set a date for its Token Generation Event (TGE).
Backpack plans to release 25% of the total supply of one million tokens at the token’s launch. This initial batch will be given to users who participated in a points campaign or hold Mad Lads NFTs.
20% of Backpack equity will be given to users who stake for a year.
Don’t just use the next big thing.
Own it.
— Backpack
Points were earned through trading activities and seasonal programs on the platform. According to the company, no token sales have occurred yet.
Another 37.5% of the tokens are linked to Backpack’s corporate treasury and a potential IPO. The remaining supply will be unlocked for team members and investors after the IPO.
This structure reverses what Ferrante described as a flawed model, where insiders receive large early allocations and predictable selling pressure is placed on retail users.
“I’m just tired of false promises,” Ferrante wrote on X. He said that previous token launches often claimed to have utility that never materialized.
How the Equity Swap Works
Users must stake the Backpack token for a minimum of one year to be eligible. They can then exchange their staked tokens for equity at a fixed ratio.
Ferrante admitted that the setup initially starts out relatively centralized. He said that there are plans to gradually decentralize as the product develops.
Backpack was founded in 2022. Ferrante previously worked at , the trading firm associated with FTX, before both collapsed in November 2022.
Fundraising and Expansion
According to a report by Axios earlier this month, Backpack is currently in talks to raise $50 million at a pre – money valuation of $1 billion. This would make it a unicorn startup.
The exchange is already operating under regulatory frameworks in the Middle East and Europe. It is available in more than a dozen US states, with plans to expand across the country.
In October, Backpack partnered with SEC – registered transfer agent Superstate to bring tokenized stocks onchain.
The company asked users last week to verify their personal information to determine their eligibility for claiming the token.
Backpack’s token – equity announcement comes at a time when cryptocurrency companies are operating in a more favorable US regulatory environment following changes in SEC leadership.