The phrase “since the dawn of humanity” represents the kind of hyperbole that will wake up most any FinTech journalist when it appears in a press release (consumer technology journalists, on the other hand, see this kind of thing a lot—think about most any big Apple Inc. announcement).
Those words and more appeared in a pair of press releases Thursday from HUTN Inc. current owners of the venerable EF Hutton brand.
HUTN was announcing, between the two prepared statements, the creation of the FAVR coin (a new type of cryptocurrency it has developed based on the ERC721 protocol on the Ethereum platform) and how the coins were to be released as dividends to shareholders in December.
As they describe in the statement, the purpose of FAVR “unlike other coins, like Bitcoin…is not to replace existing fiat currencies.” No, the FAVR is meant to unlock the value of an existing currency, the one that has existed since the dawn of humanity, the “favor.”
Unfortunately, the favor “has never been able to extend much beyond each individual’s specific kinship, tribe or group affinity.”
That aside HUTN, has cited research by the International Monetary Fund that shows the “personal currency” of favors represents a $410 billion segment of the US$27.8 trillion value of the global informal economy as of 2015. (See the FAVR white paper for a more lengthy and detailed explanation of its methodology and philosophy.)
Now for some mechanics of the rollout: First, FAVRs will be distributed to shareholders of HUTN as a special dividend (you must be shareholders of record of HUTN as of November 22, 2018). HUTN will then distribute FAVRs on December 12, 2018 to those shareholders who are on its books.
Keep in mind the following however:
“Coin value is a function of: (a) the maximum minting, (b) the economic value of the use case(s); and (c) the extent to which the coin is adopted for that use. In this case, adoption is expected to be significant because: (a) everyone globally is aware of, and has granted or been a grantor of favors; and (b) the first to receive FAVRs (HUTN shareholders) are those who have a vested interest in their adoption and are therefore likely to promote adoption of FAVRs in their community.”
Only 40 million FAVRs will ever be minted according to the statement; 35 million distributed by HUTN as a dividends (one for every two shares) and five million retained by HUTN.
After being issued, FAVRs are “expected to trade on one or more cryptocurrency exchanges,” but the company is not sure which ones yet. And keep in mind this little nugget from HUTN: that they do not “represent or warrant that any market will develop after the dividend is received by shareholders.”
HUTN put out a press release Oct. 19 announcing a different “instrument” it planned to introduce by the end of November 2018 projected to be called iBTC, which the company described as a version of Bitcoin built on blockchain technology. The “I,” according to the statement, stands for “inverse,” meaning that iBTC is being designed to provide the economic inverse of Bitcoin (BTC). By that logic, the use case for iBT is as a hedge to BTC.
Wealth Management reported in September on the company’s plans to enter the cryptocurrency business with “multiple instruments, coins and tokens,” along with an overview of the firm’s resurrection in 2012 and what has followed in the interim.