STO tokens are beneficial to the issuers, too. They aim to correct perceived inequalities on the investor side, such as granting security token holders rights to dividends or other predefined revenue streams. Security token offerings are meant to be a regulatory compliant alternative to regular token sales. What Are The Benefits Of STO?ĭuring the 2017-2018 ICO mania, many token issuers have sold investors bags of tokens without any economic rights, value or regard for existing securities laws.
Thus, security tokens trade on specialized exchanges. Exchanges that want to offer security token trading need to fully comply with regulations, including extensive investigations into token listings, data sharing, and investor onboarding procedures. Security tokens are not traded on regular token exchanges.
These are tokens that are fungible, negotiable financial instruments with attached monetary value, like a part of property or company. They are linked to an underlying investment asset in a way like stocks, bonds, real estate investment trusts (REIT) or other funds.Īs such, security token offerings distribute securities. However, unlike ICOs, STO’s take it a step further and distribute tokens that fall under the status of securities. It is a process similar to an ICO where an investor exchanges money for coins or tokens representing their investment. But what is it, and why is it important? What Is An STO? Security token offering (STO) is frequently called the next step in token evolution.
0 kommentar(er)
