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Circle Eyes Tokenized Securities with SeedInvest Acquisition

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Circle Eyes Tokenized Securities with SeedInvest Acquisition

Done Deal

A deal that was first announced in October of 2018, has officially been completed – Circle has acquired SeedInvest. While announced in October, approval from FINRA was required, resulting in the delayed confirmation given today.

This deal is of more significance than most.  It marks the entrance of a major company in the digital securities sector. However, this entrance shouldn’t come as a surprise, as Circle has previously underscored their belief that digital securities and stablecoins are intriguing and emerging trends.

By acquiring SeedInvest, Circle now welcomes a proficient and reputable company under their wing. Here, SeedInvest will function alongside other Circle acquisitions, such as Poloniex. SeedInvest will continue to function as they always have, and with the same team retained. This means that they will continue to be the crowdfunding platform they always have, except, now with the support of Circle – a company valued at nearly $3 billion less than a year ago.

The difference will be that, through increased resources and reach, these companies will be delving in the world of digital securities in the near future. While SeedInvest has helped over 150 start-ups raise over $100 million to date, this process could become even more productive through the tokenization of equity.

With Poloniex offering the services of an established cryptocurrency exchange, it could, one day, prove to be the perfect platform to provide secondary market trading of digital securities. In doing so, Circle will have a well-rounded suite of companies that can offer end-to-end investor services.

Commentary

Both Circle and SeedInvest released information today on their respective sites, regarding the acquisition.

Circle commented on their intentions, stating,

“Broadly, we aspire to bring the economic and technical breakthroughs of crypto assets and blockchain technology traditional forms of financial contracts such as equities and other securities. We believe that the tokenization of financial assets will ultimately unlock capital for rowing companies and investment opportunities for people everywhere. Over time, more functions of private equity will be tokenized – including voting and governance, dividend payouts, and other economic features. Tokenization will also create new opportunities for businesses to build better relationships with their customers by leveraging tokens linked to ecosystem behaviours.”

SeedInvest also touched on the significant of digital securities, and the role they will play in their future. It was stated,

“As part of Circle we will chase the remaining pieces of our original vision for SeedInvest. Since the passage of the JOBS Act, we have leveraged the Internet to streamline the startup fundraising and investing processes. We believe that tokenizing startups can take things to another level by providing liquidity, enabling capital to flow across geographic borders, and paving the path for completely new types of capital formation. And startups are just the beginning.”

Circle

Circle is a Boston based company that was founded by Jeremy Allaire and Sean Neville, in 2013. Since operations began, Circle has managed to become an industry leader.

They have shown their belief in blockchain, and the role it will play in the future of finance. Recognizing this led the company to make waves 1 year ago.  This was done through the $440 million purchase of crypto-exchange, Poloniex.

SeedInvest

SeedInvest is a New York based company that was founded in 2012 by Ryan Feit, and James Han. In the time since, they have grown to be one of the most successful crowdfunding campaign platforms, worldwide. Accomplishments of note in their time of operation include their participation in the passing of the 2012 JOBS Act.

In Other News

To learn more about Circle and their moves within the industry, make sure to read the article below.

Circle Identifies Stablecoins and Digital Securities as Emerging Trends

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Joshua Stoner is a multi-faceted working professional. He has a great interest in the revolutionary 'blockchain' technology. In addition to this, he is a licenced Paramedic in Nova Scotia, Canada. As such, he can provide emergency care/medicine to any situation necessitating it.

Security Token News

CoinList Founder Andy Bromberg Discusses Security Token Trends

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CoinList Founder Andy Bromberg Discusses Security Token Trends

The security token sector continues to be a hot button issue amongst the crypto community. This month, CoinList founder Andy Bromberg took some time to discuss the importance of these tokens, and how the coming months might play out. Unexpectedly, Bromberg had mixed feelings on the market’s trajectory.

In a recent interview, Bromberg pointed out some of the major issues facing the security token sector. He believes that the lack of clear regulations is the main factor deterring large scale adoption. Businesses are still unsure of what to think of this new crowdfunding strategy. The lack of transparency from regulators leaves many potential blockchain investors with unanswered questions.

Andy Bromberg via Twitter

Andy Bromberg via Twitter

More Guidance

Recognizing the need for more clarity in the space, the SEC issued multiple statements this year. These posts are an attempt by the SEC to help business owners understand the classifications of each type of token, and what regulations it falls under. Most recently, the SEC released a full guidance that covers each token class in detail.

STO Regulations Evolve

When STOs first emerged, many businesses saw these tokens as a cheaper and quicker alternative to traditional securities. At that time, the market lacked any regulatory structure. Businesses were able to issue tokens at will.

Nowadays this is no longer the case. The SEC recently stepped into the space in a major way. As a result, numerous businesses faced backlash for issuing securities illegally. Consequently, the STO market slowed until recently.

It Takes Time

When asked about the markets adoption rate, Bromberg was quick to let people know there is still a lot of time before STOs make it to the mainstream. The savvy crypto advocate noted that it could be years still until STOs gain enough traction to become a major crowdfunding strategy.

CoinList

CoinList entered the market in 2017 with the goal of providing financial services to next-gen tech firms. The company has headquarters in New York and offices in San Francisco. Notably, the firm has fewer than 50 employees according to Crunchbase.

CoinList offers clients advisory services regarding blockchain-based investment strategies. As the President of CoinList, Bromberg is uniquely positioned to understand the sector’s demands. His company hears the concerns of both investors and service providers. Discussing the issues, Bromberg described how there is little incentive for companies to make the shift to the crypto ecosystem at this time.

Bromberg feels that in order for companies to have confidence in these new systems, there needs to be a clear legal framework that doesn’t detract from the advantages of blockchain technology. Basically, legislators need to fully understand the advantages of blockchain technology in order to structure regulations that enable the tech to function at peak performance levels.

CoinList STOs – A Bumpy Road Ahead

The overall tone of Bromberg is one of a man who fully understands the complicated scenarios that play out in the cryptospace. His ability to point out these shortcomings is sure to help CoinList remain a dominant player in the future.

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Polymath Partners with QRC Group- Eyes Asian Markets

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Polymath Partners with QRC Group- Eyes Asian Markets

Asian companies looking to host an STO in the future just got a powerful alley. The token issuance platform Polymath announced a strategic partnership with one of Asia’s most successful STO consulting firms – the QRC Group. The partnership strengthens Polymath’s presence in the region. Also, it provides future STOs with the added guidance needed to make their crowdfunding campaigns a success.

News of the strategic partnership first broke via a Polymath blog post. In the post, the firm discusses Polymath’s goal to make token issuance as easy as possible. Notably, providing companies access to valuable third-parties is an integral part of Polymath’s all-inclusive strategy.

QRC Group

The QRC Group has an excellent reputation as an established STO advisory in the Asian marketplace. This Hong Kong-based firm provides companies with a plethora of STO-related services such as turnkey issuance. Additionally, QRC provides end-to-end solutions for STOs, including access to regulated secondary market trading.

QRC Group via Homepage

QRC Group via Homepage

Speaking on the developments, the CEO of the QRC Group, Shoga Ishida described the partnership as an “important milestone” for his firm. Ishida pointed out Polymath’s ideal position in the market. He then explained how QRC plans to help businesses seeking more guidance. According to the post, QRC will offer consultation in:

  • Legal
  • Compliance
  • Token issuance
  • Technical infrastructure

Currently, QRC hosts a variety of blockchain-related programs. These run the full scope of the sector ranging from production and investment services, all the way to identity verification platforms. Additionally, the company has a native multi-currency STO wallet capable of storing over a thousand different tokens in the works.

International Standards

Notably, QRC continues to push for international STO standards for the Asian and Southeast Asian markets. Asia plays a huge role in the crypto market. QRC believes that standards are needed in order for the STO market to reach its full potential in the region. Importantly, businesses need this regulatory framework in place before considering STOs to be an attractive alternative to the status quo.

The QRC Group currently works with multiple universities including Taiwan Tech and the University of Malaya. These programs study the effects of blockchain technology, and how it relates to the digitization of the global markets.

Polymath on QRC Group Services

Polymath’s Head of Tokenization, Graeme Moore also took a moment to describe why the QRC Group was the perfect addition to the Polymath ecosystem. He explained why connecting high-quality service providers with valuable business resources, is critical for the developing STO space.

Polymath via LinkedIn

Polymath via LinkedIn

Partnerships

Polymath continues to expand its network. The firm made headlines numerous times this year including in June when it partnered with Ethereum co-founder, Charles Hoskinson on the Polymesh project. Polymesh is a separate blockchain designed specifically for compliant tokens.

Polymath – STO Pioneers

Polymath’s expanding network is just one example of how STO providers plan to bridge the knowledge gap between businesses interested in hosting STOs, and providers of these services. The addition of the QRC Group provides the network with a host of valuable resources. You can expect to see these services play a major role in Polymath’s future token issuances.

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BaFin Approves Germany based STO Platform by Black Manta Capital

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BaFin Approves Germany based STO Platform by Black Manta Capital

Licence Approval

In a process that took roughly 9 months, Luxembourg based, Black Manta Capital, was awarded licensure to operate an STO platform within Germany. This licensure was provided by regulatory body, BaFin.

This development moves the company one step toward their self-described mission of setting “a global standard for Security Token Offerings (STO).”

In their release, the company hinted towards a launch date, stating,

“The operative start of the investment platform with the first Token Offerings is planned for early Q4/2019.”

STO Platform

The approval received allows for Black Manta Capital to offer clients services surrounding security token offerings. Black Manta Capital has indicated that they intend for this platform to function as a comprehensive offering – meaning that they will provide clients all the necessary services from start to finish, through the tokenization process.

The act of tokenization involves selling, creating, and distributing digital securities which represent ownership of a variety of assets. These assets may range from cars, to art, to equity within a company, and anything in between. As these digital assets are securities, their creation and distribution is only possible when adhering to laws enforced by typical regulatory bodies, such as BaFin.

The Competition

The STO platform to be offered by Black Manta Capital is expected to face stiff competition, as Europe is quickly becoming a hot bed for companies with similar ambitions. The following are a few of those expected to fit this role.

Commentary

Upon making their announcement, Managing Partner of Black Manta Capital, Christian Platzer, took the time to comment. The following is what he had to say on the matter.

“Tokenization in the core financial field of securities will – for sure – bring paradigmatic change to the global financial markets.” – “While Black Manta Capital Partners want to be ‘boutique’ in its beginnings and run ‘handpicked’ STOs only, our strategy is global from day one: the first step is to link Europe and Asia on one blockchain-based investment platform. Therefore we look already today into Singapore.”

Black Manta Capital

Black Manta Capital is a young company which specializes in tokenization services. Operating out of Luxembourg since 2018, the company has plans for eventual expansion across various continents.

Managing Partners, Christian Platzer and Alexander Rapatz, currently oversee company operations.

BaFin

BaFin is a leading financial supervising authority across Europe. With over 2,600 employees, this regulatory body oversees a variety of industries ranging from finance, to banking, insurance, and more.

The organization has been operational since being founded in 2002.

In Other News

Today’s announcement is not the first time that BaFin has provided licencing to outfits partaking in the digital securities sector. The following articles demonstrate a pair of other companies that have also been successful in this respect.

BitBond Gains Approval of BaFin to Host Security Token Offering

Fundament Group to Issue €250 Million in Security Tokens backed by German Real Estate

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