Ryan Kavanaugh’s Proxima Media on Tuesday announced plans for a new crypto-based financing tool to fund film, TV, music and other IP-driven content called Proxicoin, with a $100 million investment from Central Wealth Group of Hong Kong and Step Ventures.
Proxicoin, which is owned and created by Kavanaugh’s newly launched Proxima Media, plans to issue cryptographic tokens on the Ethereum platform allowing individuals to invest in fractions of film and TV slates. It’s the latest post-bitcoin, crypto update on crowdfunding for entertainment industry assets, following ventures like MovieCoin.
The token has been built and audited, the company said, adding that a deal has been signed with Malaysia-based Fusang Exchange, the first crypto exchange in Asia with approval to trade security tokens. That exchange is expected to launch later this year, Fusang has said.
“Proxicoin makes a highly sought-after financial product available to many individual and smaller investors,” Vincent Tse, CEO of Hong Kong-based Step Ventures, said in a statement. “Film, as an asset class, is traditionally uncorrelated to capital markets and has been a competitive and sought-after asset class among the large hedge funds and banks including Citibank, Duetsche Bank, JP Morgan, Goldman Sachs and many others.”
Proxicoin holders will also be partial owners of Entertainment Stock X (ESX), a new platform that the company intends to launch by the end of the year that would work like a stock exchange for financing entertainment projects through Regulation A of the JOBS act.
Each film or TV show will undergo an IPO, providing liquidity for each through aftermarket trading. The trading platform already has deals for listings on over 30 feature film projects, the company said, though no specific titles were announced.
“Blockchain technology is enabling new business models that unlock value in traditional industries like film financing. Global audiences can now participate as investors in tokenized offerings through a new asset class,” Aman Johar, principal at Proteum Capital and an early consultant to Proxicoin, said in a statement.
“We are confident that Proxicoin will create unprecedented value by establishing a marketplace for global entertainment assets.”
“The advancement of digital securities and tokenization technology are creating an unprecedented opportunity to open Hollywood and entertainment investments to the world, while offering liquidity and transparency to investors in a way that has never been possible before,” Kavanaugh said. “This exchange will give ordinary consumers worldwide access to investments in their favorite movies, something they love, in a way that was previously only available to a limited few.”
David Lee of The Central Wealth Group of Hong Kong added: “We are impressed by the Proxicoin team and their dedication to creating cooperation and synergies between the China and Hollywood film industries.”
Last week, Kavanaugh announced the launch of Proxima Media backed by a $250 million investment to produce up to to 10 U.S. films in China. In addition, the company partnered with China’s National Arts Studio, a publicly traded physical studio boasting a 100-square-mile ranch an hour from Hong Kong.
As part of the agreement, Proxima would raise $100 million for National Arts Studio’s expansion and acquire a 25% stake in the company, and take over management and building out of the studio, according to the parties.
Kavanaugh has been reinjecting himself into Hollywood after the collapse of his last indie studio, Relativity Media. Last August, Relativity filed for bankruptcy for the second time in three years and its assets were sold to UltraV Group, a joint venture of funds managed by Sound Point Capital Management and RMRM Holdings, for an undisclosed price.