Fully Homomorphic Encryption (FHE) track privacy chain Octra announced it will launch an ICO on Sonar with a fully diluted valuation (FDV) of 200 million USD, selling 10% of tokens and raising 20 million USD. However, there is intense discussion about whether its valuation and fundraising pace are sufficient to benchmark against the current track leader Zama. Meanwhile, Zama will also hold a token auction in January next year, with both competing against each other, making it hard to maintain wallets.
Sonar re-launches ICO: Octra raises 20 million USD with a 200 million USD FDV
Octra announced that after experiencing a 4 million USD pre-seed financing from Finality Capital, Big Brain Holdings, Cogitent Ventures, and Outlier Ventures, the team turned to conduct two rounds of community-style private placements (totaling 4 million USD) on Echo, bringing its total fundraising amount to only 8 million USD.
Now set to hold an ICO on December 18 on Sonar, selling 10% to 20% of the token supply to raise $20 million at a $200 million FDV, adopting a fixed valuation and fully unlocking the tokens. The specific token distribution is as follows:
18%: Early investors
15%: Octra Labs
10%: ICO
10%: ICO expansion quota (if unused, will be destroyed)
10%: Ecosystem grants and liquidity programs
5%: Echo participants
5%: Completed Faucet airdrop
27%: Validator rewards (unmined)
The team emphasizes that 2/3 of the token supply will be allocated to the community, 1/3 to development and early investors, and no single investor will hold more than 3%.
Technically, Octra's founder Alex claims that the network possesses fully self-developed FHE technology, and asserts it can become the 'programmable privacy layer' of the crypto world, supporting scenarios such as private DeFi, dark pool trading, and AI confidential computing.
(What is Fully Homomorphic Encryption (FHE)? How can privacy computing change the blockchain application ecosystem?)
Market skepticism arises, is $200 million FDV overvalued?
However, there are mixed opinions in the market. Crypto KOL @luyaoyuan questions: 'Octra raised $9 million in the early pre-seed and multiple community rounds, selling about 20% of its tokens. Now it is selling another 10% at a $200 million valuation, benchmarked against Zama's $1 billion valuation, what justification does Octra have?'
Kevin Simback, COO of Delphi Labs, also believes that a $200 million valuation is too high, especially in a market where demand is still low.
On the other hand, KOL crypto Weituo softened the tone, noting that considering the need to list on centralized exchanges (CEX), projects must meet specific standards in valuation and circulating market capitalization to be included, which is understandable.
Zama simultaneous ICO: 10% supply using sealed Dutch auction, valuation looking at $1 billion.
Last week, Zama, considered one of the leaders in the FHE track, just announced that it will hold a token auction from January 12 to 15 next year, selling 10% of the $ZAMA supply.
Example: When the final settlement price is $4, Alice will receive all token quotas at a price of $4 (excess bids will be refunded), Bob will receive token quotas proportionally with other bidders at the same price (partial refunds), and Charlie will not receive a quota due to a bid below the settlement price (full refund).
Specifically, the auction adopts a 'sealed Dutch auction' format, where all quantity bids are encrypted and hidden, and cannot be known to each other. The starting bid is valued at $55 million FDV with no upper limit, 8% of the supply is sold through the auction (obtaining the full quota), and 2% will be sold at the final settlement price to investors whose bids equal the settlement price (tokens are allocated proportionally).
According to Zama's $57 million Series B financing at a $1 billion valuation last June, the market expects this auction's valuation range to fall between $500 million and $1 billion.
The team emphasizes that the mainnet will launch before the token auction, and the tokens will be fully unlocked at that time.
The ICO showdown in the FHE track: Octra vs. Zama, who can attract the market more?
The timing of the two projects' token issuance is extremely close, and with the privacy narrative heating up again alongside Zcash, the token wars of FHE projects have also become a focal point in the market. One is adopting a traditional fixed valuation ICO at a relatively cheap $200 million FDV, while the other is using a sealed Dutch auction at nearly $1 billion FDV.
The author believes that given that Octra's VC round had only one round before turning to multiple community rounds, it might indicate challenges in venture capital financing.
In the current context of weaker liquidity and a market turning conservative, issuing tokens may need to consider community sentiment rather than a strong narrative. Moreover, the current FHE privacy narrative is far less heated than last year's AI agent. Investors should think carefully before betting, with a focus on leading projects being a more ideal choice (not investment advice).
(How does the timing of TGE affect project development? Identifying investment opportunities for valuable tokens from discerning strong and weak TGE.)
This article discusses whether Octra, positioned in the privacy track with a $200 million valuation, can compete against Zama in its ICO on Sonar. Originally published in Chain News ABMedia.
