US markets are complex from a Security Token StandpointOctober 23, 2018
The US market is filled with enormous numbers of investors; however, it is a complex market when considered from the security token market standpoint.
It is very important to ensure that everything is in check with respect to US regulations. Whether it is about dealing with custodians, banks, transfer agents or brokerage houses, it is all about regulations in the US.
Established exchanges who are working on strategic investment with security tokens like tokenizing everything ranging from rental real estate properties, patents and more.
The smart contract framework is used to support the grand ambition of the security token companies. The legal-financial institutions guarantee the smart contract driven deals.
Highly valuable stable coins are robustly backed by experienced teams of advisors, larger teams, and strategic implementations.
Strategic investment and partnership are seen to be the key in most of the security issuance platforms like Leaseum partners.
The issuance of a security token is a silent yet strong battle between the traditional financing world and the fintech crypto space. The advantages strongly score for security tokens with respect to efficient timing, massive cost cuts, programmable securities, fractionation of assets, secure transfer of ownership and more that will make security tokens the ideal future of the securities space.
Carlos Domingo previously stated, “It is inevitable that the security tokens will transform equity just like Bitcoin transformed currency. They afford the owner direct and liquid economic interest with an expedited delivery of proceeds. With every type of ownership being tokenized, it is a massive multi-trillion dollar addressable market.”
When the middlemen are eliminated from the transactions, most of the responsibilities are shifted to the buyers and sellers. The major role of rules and regulations with respect to the securities industry is mainly focused on shifting the regulatory responsibility and compliance to buyers and sellers as they are the direct parties to the transactions, benefits, and liabilities in the process.
While the regulatory process for security token companies in the US are currently an obstacle, one the regulatory norms are pinned in place, it will be easy for companies to work towards complying with regulatory practices and once they get approved, they will sprout soon in the industry. The course of regulation is strategic and is in the development and initial phase now. Once, regulatory compliance is well read and well established the norms will become an everyday standard for industries.
The concept of security tokens has been barely scratched. These tokens are definitely on their way to introducing a new paradigm in the securities industry. With firmly established regulations, compliance will become a mandatory factor and those dipping their toes to these waters will do what it takes to gain their entry into this potential market.