At 7:00 a.m. PST, June 12, 2017, Bancor announced the opening of its token offering. Would-be investors swarmed to the chance to exchange Ether for Bancor Network Tokens (BNTs).
The token offering had a one-hour minimum time wherein all contributions would be accepted in an effort to prevent whale investors from seizing all BNTs available to the public. Bancor also affiliated with escrow agent Bitcoin Suisse AG, which offered non-U.S. citizens the opportunity to obtain a guaranteed stake in BNT through a pre-contribution offering, in accordance with the terms of Bitcoin Suisse AG's Framework Agreement.
During the offering, the Ethereum network was clogged with transactions; whether that was from directed denial of service (DDoS) attacks or simply enthusiasm from crowdsale participants remains unclear.
On Bancor's end, via Twitter, the company reported that a massive attack coinciding with the token offering affected its website and application.
As a result, the mechanism which the token offering was operating under, a hidden cap, became stuck with another transaction and failed to trigger. In light of the network difficulties, Bancor opted to extend the minimum time for the token offering by approximately three hours, or until the second hidden cap was met, whereupon the offering would end. When the second hidden cap was hit, Bancor had raised 396,720 Ether and sold 79.3 million BNTs, valued at the time of the offering at more than $142 million.
Massive attacks are on our network, website and application. Not on Ethereum— Bancor (@BancorNetwork) June 12, 2017
Bancor had previously taken to Twitter to announce partnerships with Enterprise Ethereum Alliance and other fellow blockchain companies, such as Gnosis, Aragon, Smart Contract Japan, Status, Antshares, Starbase, and imToken, before the token offering.
Two independent audits performed by Ethereum Name Service’s core developer, Nick Johnson, found no critical issues with Bancor's token offering. In his report, Johnson said none of the issues presented security vulnerabilities or an undue advantage to an attack, save one, which is not uncommon to exchanges. He went on to assure that Bancor has a way to handle it:
"This issue is common to all onchain exchanges, and countermeasures are difficult for any exchange, though on talking to the Bancor team they have suggestions for future improvements. Bancor have somewhat mitigated frontrunning by requiring users to specify a minimum price at which a trade will be executed, to hedge against large price shifts."
Token allocation and the use of proceeds are clearly defined by Bancor, which provided easy to reference pie charts in a Medium post:
Tokens will be immediately distributed to investors who exchanged Ether for BNT but traders must wait seven days before they can choose to liquidate or diversify their holdings into other cryptocurrencies.
The protocol Bancor created, if successfully implemented across blockchain platforms, will herald liquidity and interoperability for Dapps and traders.