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A $ 675 million deal to buy a famous New York hotel with an initial offer of coins is Tanking

The Plaza Hotel during its 100-year birthday celebration in 2007.
Photo: AP

Investors are moving away from a $ 675 million deal to buy the historic Plaza Hotel in New York, in part raising $ 375 million through an initial offering of currencies: a largely unregulated form of investment in which cryptocurrency investors are offered instead of traditional shares.

According to Per People Insider, sources say that the promise to buy a New York symbol was owned by President Donald Trump (who admitted that it led to bankruptcy) is not enough to attract investors to the offer. But it is not clear from the report if they are being deactivated because of the possibility that the hotel does not have a solid return on investment, or if they shout "crypto!" It is no longer enough to take millions of dollars out of wallets given the recent volatility in the market and the threat of regulatory intervention.

Here is the relevant passage:

The sources told Business Insider that the agreement would first involve a private transaction in which Chimera would raise more than $ 675 million to buy the Plaza. A token public offering to pay the debt of the original transaction was considered as a next step. The sources doubt whether it will be fulfilled or not.

The agreement is not progressing, according to several people, and is failing to attract enough investors. The people, who were potential investors, have moved away from the deal.

The agreement was being headed by a group of foreign investors called Chimera group, CNBC reported, who brought in the ICO Securitize platform to advise them on how the agreement would work. In addition to entering real estate, CNBC said that owning a "Token Plaza" would allow "certain concessions within the Plaza Hotel."

The current owners of the hotel, Sahara Group, based in India, have been looking to sell since at least August 2017 and apparently have not yet secured a buyer. Kevin O & # 39; Leary, one of the hosts of Shark Tank had talked about the deal in recent weeks, according to Business Insider.

"In the next three weeks there will be a big change in New York" that involves a "very prestigious hotel," said O & # 39; Leary during a CNBC presentation. "… It's a $ 400 million coin issue for a real asset you've heard about."

Initial offers of currencies are sometimes seen as a way to circumvent regulatory oversight around the world and are viewed with suspicion by some in the financial community. Last year, notorious Wall Street scam artist Jordan Belfort told the Financial Times : "Probably 85 percent of people do not have bad intentions, but the problem is that if five or 10 percent They try to swindle it, it's a damn disaster. "Several countries have banned them completely, including China and South Korea.

If this agreement is not carried out as planned, they are in good company: a recent analysis of Bitcoin.com found that 59 percent of the ICOs of 2017 are already dead in the water or on the way there.

[Business Insider]

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