A Long Road
As of September 26th, 2019, Harbor Square Investments was officially designated a broker/dealer by FINRA. This approval comes after an arduous process that took months to arrive at a conclusion.
By successfully being approved as registered broker/dealers, Harbor now gains the ability to buy and sell digital securities on behalf of both themselves and their client base.
As industry participants continue to gain a footing on what services they will offer their clients, various within the digital securities sector have the ability to act as broker/dealers within their respective regions.
This New York based company has long acted as a broker/dealer in traditional markets. In early 2019, they made a foray into digital securities, through a partnership with tZero.
One of the most well-known names in blockchain, Coinbase became a broker/dealer through the acquisition of Keystone Capital, in mid-2018. This approach was unique, as this allowed for Coinbase to gain the abilities of a broker/dealer in a short amount of time. As touched on, with regards to Harbor, applying for a new licence is a long process – Inheritance of such licensure through company acquisition has the potential to be a much more efficient route to take.
Harbor CEO, Josh Stein, spoke with news outlet, CoinDesk, commenting on the development discussed here today. The following is what he had to say on the matter.
Speaking on the length of time it took to get to this point, he stated,
“It took the regulators a long time to get a handle on the space and understand it and its implications,” Harbor CEO Josh Stein told CoinDesk. “This was very new for the SEC and FINRA, and they wanted to do it right.”
With their new designation in hand, Stein continued, commenting on the future,
“We’re going to provide the technology platform to manage the fundraising, the technology to manage investors, the technology to tokenize and enable liquidity.”
Operating out of the United States, Harbor is a tokenization platform that was founded in 2017. In the time since their launch, the company has managed to create a specialized token standard meant to serve the industry, known as ‘R-Tokens’, in addition to expanding the functionality of their platform.
Harbor Square Investments is a subsidiary of Harbor.
CEO, Josh Stein, currently oversees company operations.
We recently reported on Harbor, as they continue their efforts to serve the digital securities sector. In this recent look at the company, they caught our eye with the tokenization of $100M worth of real estate.
Short for ‘Financial Industry Regulatory Authority’, FINRA, is a regulatory body, given their power by Congress. They are tasked with ensuring compliance among broker/dealers serving U.S. based investors.
CEO, Robert W. Cook, currently oversees the organization’s operations.
In Other News
In recent months, we have seen various companies issue new licencing and designations. This has allowed for various industry participants to expand the services they offer their clients, in a regulatory compliant manner. The following articles highlight one such expansion, along with a look at the various titles held by companies like Harbor.
TokenSoft Launches Major Wallet Upgrade
This week, the SEC-regulated security token issuance platform, TokenSoft introduced a major upgrade. The new functionality comes in the form of a self-managed wallet for traders. The revamped system promises to be an easy-to-use interface coupled with advanced safety measures. Notably, the upgrade falls in line with TokenSoft’s recent expansions in the market.
Importantly, the new wallet features a less technical user interface. As such, users can easily maintain and manage investments directly from the wallet portal. Additionally, the new wallet integrates a host of regulatory-compliant safety measures, most similar in nature to Ethereum’s ERC-1404 protocol. Also, the wallet includes benefits for issuers as well. For example, there is built-in reporting to simplify auditing systems. Additionally, users receive automated dividend distributions, which also reduces transaction costs.
ITokenSoft added some important security updates to their wallet as well. For accounts that hold over $1 billion in investments, a new Multi-signature system is available. The system utilizes a key mannequin to provide the highest level of protection for your digital assets. Multi-signature wallets provide more protection than traditional wallets. Mainly because there are multiple keys required to complete a transaction.
Discussing the upgrade, TokenSoft CEO, Mason Borda described the excitement surrounding the project. He explained how the new wallet pairs a “safety package” with a simplified UX. This simplification of the STO process is sure to benefit the firm’s 100,000 registered traders.
Additionally, Jordan Davis, Director of Enterprise, described the effect of the upgrade within the financial markets. He stated that these new features apply pressure on traditional financial institutions to reply with a similar product. In turn, all investors benefit because of the new administration instruments. Davis envisions a day where you can easily choose what providers have access to your account, as easy as you choose Netflix shows to watch.
Last Wallet Upgrade
TokenSoft’s last major wallet upgrade came in January 2019. At that time, the firm announced the launch of its Knox Wallet. Impressively, the Knox Wallet was one of the first mobile, cold-storage solutions for securing digital securities.
TokenSoft entered the market in 2017 with the goal to simplify the issuance and management of digital securities on the blockchain, at scale, and within compliance. The San Francisco-based firm currently offers a full suite of security token and tokenization services. Since its inception, the company continued to gain popularity. Today, TokenSoft is one of the most recognizable names in the market.
In December, the firm’s subsidiary, DTAC LLC registered with the SEC as a Transfer Agent. Importantly, the firm also partnered with Ex- Israeli military cybersecurity firm – HUB Security this month. HUB now provides TokenSoft advanced end-to-end encryption protection on USB and Bluetooth devices.
TokenSoft Gains Momentum
TokenSoft continues to make headlines across the sector for its innovative approach to the market. The firm consistently advances its functionality and positioning. You can expect this latest upgrade to further cement TokenSoft as an industry leader.
TokenSoft Partners with Ex-Military Cyber Firm Hub Security
This week, the token issuance platform, TokenSoft made major upgrades to the security of its systems via a partnership with Israel’s ex-military cyber firm Hub Security. The maneuver gives Tokensoft access to some of the most advanced security features in the world. As such, the partnership bolsters the firm’s market positioning in a major way.
Discussing the new partnership, Mason Borda, TokenSoft’s CEO explained his firm’s dedication to customer security as a key priority. Additionally, he spoke on how the current state of the market lacks access to institutional-grade technology solutions for security tokens. Borda stated that his firm was “delighted” to partner with such a reputable security service provider.
Consequently, Tokensoft now offers users top-tier, military-grade protection for their tokens, keys, and assets. The integration gives Tokensoft the most advanced key management solution available in the market today.
Specifically, clients of TokenSoft’s transfer agent, DTAC are now privy to military-grade cybersecurity tactics. These security upgrades include FIPS140-2 Level 4 protection. On top of this protection, TokenSoft now offers a combination of hardware and software solutions to keep your tokens safe. These features include a multi-signature vault, a hardware firewall, and access control. Notably, the platform also integrates a neural network learning system designed to anticipate cyberattacks
Hub Security’s miniHSM solution provides governments, militaries, and companies end-to-end encrypted USB and wireless Bluetooth connectivity. This strategy creates a cryptographic environment for the whole lifecycle of digital assets. Developers believe this approach will help curb attacks from organized crime and hackers in the future.
Additionally, TokenSoft now gains access to Hub’s management solution. This suite of products includes Hub Security’s HSM device and independent OS for the encryption, management, and distribution of keys.
Speaking on the development, Eyal Moshe CEO of Hub Security touted the reasoning behind an end-to-end approach to the development and delivery of hardware and software components. He described why this strategy provides the highest level of security throughout the entire product lifecycle. Interestingly, he pointed out that the Covid-19 pandemic prevents people from “operating the on-premise security systems that controls large amounts of assets.”
Tokensoft entered the market in 2017 with the goal to simplify the processes involved for companies seeking to issue and manage digital securities on the blockchain, at scale, and within compliance. Recently, the firm acquired a stake in an SEC-regulated firm in a move that allows the company to operate as a registered broker-dealer in the US.
Hub Security entered the market on Nov 1, 2017. The firm offers hardware security solutions for regulation, privacy, fintech, cloud, and blockchain systems. Specifically, the company specializes in blockchain, cybersecurity, financial services, FinTech, information technology, and privacy products.
TokenSoft – Security First
TokenSoft is now ready to continue on its path towards tokenizing the global markets. This company made the right move when it decided to beef up its security via Hub. Now, the platform can offer its users the highest level of protection available. This added protection is critical when you consider the number of attacks these platforms continue to encounter. Hopefully, the new security measures will prove effective at protecting users tokens in the future.
Blockpulse – Lemonway Receive Registration from ACPR Banque de France
This week, the French tokenization startup Blockpulse received registration from the ACPR Bank of France. The regulatory approval allows Blockpulse to move forward with its tokenization platform. Importantly, the registration makes Blockpulse the first STO platform to achieve registration from French financial regulators. Now, French investors have access to all the benefits provided by tokenized securities
As a registered STO platform, Blockpulse gains significant rights in the marketplace. For one, the registration with ACPR Banque de France allows them to add functionalities concerning the Euro. Specifically, the registration allows Blockpulse to manage euro payments for financial instruments, transfers, and token issuances.
In a recent interview, Blockpulse COO Marien Irzykiewicz spoke on his firm’s achievements. He described how the company registered at ACPR Banque de France with its partner, Lemonway, to bring the concept to reality. Importantly, Lemonway is a leading European digital payment solution provider for investment platforms.
The partnership allows the firm to simplify its business systems, For example, the strategy provides the firm the ability to manage both cash and securities flows on the same blockchain. Additionally, the company plans to automatize critical actions through the use of smart contracts. These actions could include payment disbursements, investor verifications, and token issuances.
Blockpulse entered the market in 2018 with the goal to create an all-in-one box of tools to better serve the STO community. Today, this privately owned company focuses on solutions to raise funds, associate employees and manage investors. Notably, French companies can manage their fundraising in a manner that was previously not possible using the platform. As such, the platform allows companies to create legal documentation, electronic signatures, online payments, cap tables and registry of share movements directly.
For its part, Lemonway provides Blockpulse with top-tier KYC / LCBFT services. Recently, Blockpulse developers described the partnership as a success. They explained that the partnership brings more liquid management to the market. Also, it ensures that Blockport meets all the EU’s stringent securities regulations.
At this time, Blockpulse is only available to French residents. The company’s CEO stated that the firm intends to “expand in the European Union through Benelux and Spain” in the coming months. For now, investors outside of France can participate in sales, but only meeting pending regulatory restrictions.
French Pivot to Blockchain
As of last year, French regulators began an open policy towards STO integration. Notably, in September 2019, the French Central Bank Governor, Villeroy de Galhau, stated that the bank was observing tokenized securities with “great interests.” Earlier in the same year, Societe Generale, the third-largest bank in the country, issued a €100 million tokenized bond. This latest registration demonstrates that regulators are ready to push blockchain integration to new heights.
Feel the Blockpulse
Blockpulse receiving registration from the ACPR Banque de France is a huge step forward for the entire EU market. The French STO sector could use this momentum to catch up to its EU counterparts in the coming months. As it stands today, the company has the positioning to become the premier STO platform in the country.
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