Shares of Renren—China’s forgotten social network—just jumped after ICO announcement

Renren, the “first Facebook of China” that has fallen out of fashion in recent years, is making a strong comeback in New York this week with its shares surging to over $18 by Jan 4, up from around $10 before the new year.

The spike came after Renren announced its plan to start an ICO project called RR Coin, “an open-source blockchain platform for social networks,” says the social networking company. Renren marks another top Chinese dot-com company after Xunlei that wants to reinvigorate their business through a blockchain dream.

Analysts also attributed Renren’s strong performance to the company’s recent acquisition of the American company Trucker Path, a trip planning app for truck drivers.

Born in 2005, Renren was part of China’s first generation of social networks and one of the first to pioneer real-name registration for SNS. The site became immensely popular among Chinese students but started to lose traction when Sina Weibo and Tencent’s WeChat triumphed in the networking battle of China’s mobile era.

“Currently, the two major emerging technology areas are artificial intelligence and blockchain,” says Joseph Chen, chairman and CEO of Renren. “With the acquisition of the Trucker Path social platform and the Truckloads freight marketplace, the Company will be well-positioned technologically to drive innovation within this important industry.”

A white paper (in Chinese) released by RR Coin states that a blockchain-based, open-source approach to social networking platforms can eliminate information asymmetry by “recording all the interactions of participants through a decentralized booking system and managing their trading behavior under certain social networking scenarios through smart contracts.”

Users, content creators, developers, and advertisers can all earn tokens in RR Coin’s merit-based system. When a user sends gifts to a live streaming host, for example, the gifts will be awarded pro rata to the host and the developer who helped develop the live streaming system. The user, on the other ward, earns token based on the number of comments and shares he or she contributes.

RRCoin is planning to launch a beta version in Q2 2018 with one billion coins in total. 40% will be used for ICO sale, 25% for the RRCoin Foundation, 15% for development and marketing, and 20% for business expansion and partnerships.