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DigitalTown Becomes First Ever U.S. Company to Be Acquired via Cryptocurrency

DigitalTown Becomes First Ever U.S. Company to Be Acquired via Cryptocurrency

Reading Time: 2 minutes by on June 9, 2018 Altcoins, Blockchain, Business, Finance, News
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Pithia has announced it filed a Schedule 13D with the United States Securities and Exchange Commission (SEC). The filing was made after it acquired a stake in the publicly traded company DigitalTown. It is the first Schedule 13D filing ever where an investor has paid in cryptocurrency instead of fiat currency.

Pithia Invests in DigitalTown

On May 15, 2018, Pithia One LLC entered into an agreement with DigitalTown to invest $2.4 million in the company. As per the filing, Pithia One LLC via incubator Catena Fund One acquired 11.38 million common shares of DigitalTown after the investment.

The acquirers paid 1.05 million RHOC, the native currency of RChain which was trading at $1.16 on the day of the acquisition. DigitalTown helps local communities thrive by encouraging buyers to purchase locally in over 22,000 cities. The company had already announced its migration to RChain.

Pithia has backed RChain and is also a strategic partner. The firm acquired around ten percent of all common paid up shares issued by DigitalTown. As of May 22, 2018, Pithia owned 11.38 million shares out of the total 125 million outstanding common shares. The acquisition triggered a mandatory SEC Schedule 13D filing, which is typically required when a firm acquires a stake that is greater than five percent in any publicly traded company across America.

First Ever Crypto Schedule 13D Filing

The filing has now become the first ever to be completed purely in cryptocurrency. Up until now, investors would prefer US Dollar to acquire a stake in a target company. Pithia will get two seats on the Board of Directors at DigitalTown while three of the sitting board members will resign. Pithia CEO Lawrence Lerner said:

“The investment in DigitalTown brings foundational services via blockchain to consumers in everyday businesses such as restaurants, hotels and other services.”

He was positive on the future of blockchain, stating that the technology will become part of our daily lives in the future. The cities we live in will also be revolutionized by the innovation, which is something that DigitalTown is already taking steps towards.

DigitalTown CEO Robert Monster praised Lawrence and Pithia executives who brought more experience to the board. The CEO continued with:

“The combination [of DigitalTown and Pithia] is a potent one and allows us to accelerate execution of DigitalTown’s vision for thriving, sovereign and connected communities, both online and offline.”

Will This Trend Continue?

Pithia is the venture capital company of the RChain Cooperative, while RHOC being its native token. DigitalTown announced its support and migration to RChain shortly before the acquisition. As a result, all three companies have a common link and are associated with RChain. DigitalTown accepted RHOC coins to utilize these tokens on RChain for development.

However, for another company, these tokens may represent very little value if it did not support RChain at all. While Pithia has undoubtedly made history by becoming the first investor to acquire a stake in a publicly traded company using cryptocurrency, it remains to be seen whether or not other companies will also be willing to accept digital currencies for a buyout.

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