Forgotten Chinese Social Network Venturing into Cryptocurrency

Chinese social network Renren on Tuesday released a white paper detailing its plan to raise funds through an ICO which culminated in a 47 percent increase in its stock price to $18.32 a share by the close of markets on Wednesday. On Thursday, the price had settled back to $15.19 by the close of markets.

In the white paper, Renren described its plans to launch what they describe as an “open social network platform based on blockchain” which will be called RRCoin. This move will be regardless of the fact that the Chinese government banned ICOs in 2017, a move that blocked Renren’s plans to launch an ICO in September last year.

Last year, initial coin offerings (ICOs) were perhaps the biggest breakthroughs in the tech industry. At first, only people with in-depth knowledge about blockchain were in the loop, but further along the way, several existing businesses welcomed the idea of raising money without having to do so through VC and lost equity. 2017 ended with over $4 billion having been raised through ICOs and it is fair to say that the concept of ICOs has already established a strong foundation for itself from here on out.

Renren which was established back in 2005 is considered to be one of the pioneering Chinese social networking platforms – it was even dubbed the Chinese Facebook. Having fallen out of favor of the Chinese public who now prefer other social media site, Renren has since reinvented itself by venturing into the cryptocurrency space through an ICO.

Circumventing the Chinese ban

Even though China banned bitcoin and ICOs last year, Renren is listed on the New York Stock Exchange and therefore qualifies as a U.S firm. This is a great way to circumvent the Chinese ban on ICOs and bitcoin but it is bound to attract the attention among the SEC, which has even already taken action against some of the ICOs that have dared to violate the security laws that are currently in place.

“Currently, the two major emerging technology areas are artificial intelligence and blockchain,” says Renren chairman and CEO, Joseph Chen. “With the acquisition of the Trucker Path social platform and the Truckloads freight marketplace, the company will be well-positioned technologically to drive innovation within this important industry.”

RRCoin represents Renren’s return to the social space since the token is the product that the company intends to unveil at the ICO, according to the Technode. The full whitepaper for RRCoin is not out yet but in a nutshell, the company intends to develop a platform that will connect with other apps with users being rewarded with incentives for engagements. The company will, however, be focusing more on the business side of Trucker Path and they will eventually introduce the blockchain.