The innovative minds behind the ABE Global security token exchange believe they found a way to reduce IPO costs for companies significantly. The firm initially made headlines last August after securing $3 million in seed funding from investors. Now it appears development on the next level security token exchange is underway.
Based out of Malta, ABE Global's team is on a mission to improve the trading experience for all parties involved. The platform incorporates a host of new technologies to enable a more secure and efficient trading option including distributed ledger technology and advanced tokenization protocols.
ABE Global differs from other security token exchanges in a number of ways. Firstly, ABE Global will offer more than just tokenized securities. Instead, the platform deals with many financial products including depository receipts. Depository receipts represent securities of a foreign company that trades on the US markets. These are what many non-US companies trade because it makes trading foreign securities a much easier process.
The ABE Global Network
Additionally, the ABE Global platform will function uniquely in that it will connect multiple global locations but utilize Malta as the main exchange. To accomplish these tasks, ABE's American and Asian branches will offer tokens representing Malta depository receipts. The strategy is new to the market. If successful, ABE Global could open up the global securities market in ways previously not possible.
Discussing the platform's advantages, CEO John Pigott explained the progress achieved so far. According to Pigott, the firm awaits licensing approval in Malta. The platform will feature 24/7 trading and support. Also, Pigott took a moment to describe the types of products the platform will list. These products include tokenized securities, stocks, bonds, and a wide variety of other “financial instruments.”
ABE Global plans to utilize their US-based subsidiary ABE Americas to offer services in the US. Discussing the matter, developers stated that in the US tokenized securities have slightly less regulatory requirements when compared to traditional securities. This lack of regulation is found mostly in the secondary markets.
Legal Hurdles on The Horizon
ABE Global will push the legal boundaries of depository receipt use farther than ever before. Consequently, this strategy requires the SEC to sign off on the plan. According to Margaret N. Rosenfeld of K&L Gates Law, the project presents an exciting “legal puzzle” and is certainly doable. In a recent interview, she explains how the process would need to proceed moving forward.
ABE Global's innovative approach to global securities is sure to have a ripple effect in the market. This platform could greatly reduce the entry cost for businesses seeking crowdfunding options. Additionally, the platform opens up the securities market to new investors. You should watch this project carefully over the coming months as development continues.