Not all token sales led to quick failures or cash grabs. Some were part of a broader, albeit ambitious, business strategy.
The blockchain startup Patientory, which makes a consumer health app and offers enterprise data management services to hospitals and clinics, just closed a $5.2 million Series A led by R/GA Ventures. This comes as the startup’s first funding round since it split off from the Patientory Association, a nonprofit created after the May 2017 initial coin offering (ICO) of ethereum-based PTOY tokens raised $7.2 million.
“With the token, it basically regulates the storage in each node,” Chrissa McFarlane, Patientory CEO and president of the Patientory Association, told CoinDesk about her company’s token-oriented pilot programs. “You’re providing storage space and also paying for the transactions.”
That said, few people currently use the token for anything beyond experiments.
McFarlane said that beyond the holdings given to the founding team and nonprofit, she doesn’t know who is trading PTOY tokens these days on external exchanges like Upbit and Bittrex. According to CoinMarketCap, the price of PTOY plummeted in January 2018 and has remained at a pittance ever since, a fraction of a penny compared to a peak of $0.67 each in the bull market of December 2017.
However, Patientory doesn’t rely on users owning tokens. To the contrary, McFarlane said she accepts fiat payments from prospective clients and purchases tokens on their behalf to facilitate transactions. Node operators can earn these tokens as a reward for providing storage space to other network participants, but usage isn’t mandatory.
“We do not put data on the blockchain. Think of it as decentralized storage,” McFarlane said.