Our last recap noted various positive developments in the digital securities sector. These past two weeks have provided more of the same, as industry participants work with fervor to launch their products.
While their message has not changed, China issued a recent statement regarding their stance towards STOs, and various types of fund-raising events. In their message, they reaffirmed that these types of events are illegal, and will remain so.
Archax has been one of the busiest companies in recent days. In the past two weeks alone, the London based company has announced multiple new partnerships. These included both Tokeny and Quod Financial. Both of these partnerships will ensure that Archax has, not only the technological ability to offer trading services, but an inflow of projects to populate their upcoming platform.
Better Safe than Sorry
For many of the companies developing services within the digital security sector, issuer and investor safety remains paramount. Both AmaZix, and Assurely are two of these companies. Recently, Assurely has announced their STO insurance services, while AmaZix has partnered with KABN to ensure identity compliance is maintained.
On the licensure front, UK based company, Smartland, obtained access to an investment licence, through their acquisition of Shojin Financial Services. Procuring a licence through acquisition is often cheaper, quicker, and overall more efficient than applying for one themselves. This move will now allow Smartland to offer global crowdfunding services.
The promise of secondary markets is a large part of the appeal towards digital securities. It is through secondary markets that this new asset class will gain its much sought after liquidity. This fact has not been lost on industry participants. Over the past weeks, we have had various announcements pertaining to the development of these markets.
DX.Exchange for example, has announced that in addition to their unique approach in tokenizing publicly traded companies, they will be launching a secondary trading market in 2019. This announcement was made at TOKEN2049 by DX.Exchange CEO, Danial Skowronski.
A Look Forward
Looking back at these past two weeks, it is clear that the latter half of 2019 and early 2020 are going to be huge for the digital securities sector.
With each day in the present bringing new announcements of partnerships, and new entrances within the sector, there will come a time when each of these endeavours come to fruition. For now, everyone is jockeying for position.
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Libra to Utilize KoreConX in Upcoming Digital Security Offering
KoreConX has recently announced that they have been chosen by Libra Project to host an upcoming digital security offering.
This event will see Libra Project raise capital for their green initiative. Primarily, Libra Project is working to develop renewable energy sources, with the goal of bringing 1st world amenities, such as reliable power, to 100 million humans.
This endeavour represents the first fully compliant DSO to target, and be hosted, within Africa and the Middle East – also the primary regions in which the project can affect the most change.
In making the announcement of their partnership, the CEO of each, KoreConX and Libra, took the time to comment. The following is what each had to say on the matter.
Hans Fraikin, CEO and Cofounder of Libra Project, stated,
“Libra Project is thrilled to enter into this new partnership with KoreConX…Their world-class digital securities asset management protocol will accelerate our plan to become the first fully compliant DSO (digital security offering) in the Middle East and Africa. Ultimately, this partnership supports Libra Project’s mission of democratizing access to impact investments all the while bringing clean energy to hundreds of millions of people in Asia and Africa.”
Oscar Jofre, CEO and Cofounder of KoreConX, stated,
“The Middle East is a very important region for us. We want the regulators and companies in the Middle East to know that there is a provider that does things the right way and will meet their regulatory obligations. We are truly glad that more and more companies are starting to realize the transformation that comes with blockchain, and the ways it can simplify doing business.”
Libra Project is a U.K based company, operating out of London. The company maintains satellite offices in a variety of locations, including Abu Dhabi. Libra Project is actively developing their own service, known as Blockchange. This will act as a bridging platform, connecting green initiatives start-ups with interested investors.
Company operations are overseen by CEO, Hans Fraikin.
KoreConX is a New York based company, which was founded in 2016. Through their KorePartners Ecosystem, and in-house services, this young company is able to offer clients a comprehensive digital securities issuance platform.
Company operations are overseen by CEO, Oscar Jofre.
In Other News
Libra represents a growing trend surrounding ‘green’ projects. Another company which is utilizing blockchain to tackle global issues is Almond. Not only did we recently detail their company, but we had the pleasure of interviewing their CEO. Check out the following articles to learn more about Almond, and what they are doing to better the world.
Securitize DS Token Protocol goes Open Source
The security token issuance platform, Securitize raised eyebrows amongst the cryptocommunity this week after releasing its DS Token code to the public. The move goes along with the crypto sectors long-held stance of open-source projects. Now, programmers from across the globe have a chance to test and advance the platform’s core coding.
News of Securitize’s decision spread quickly after the announcement was made at Coindesk’s latest Consensus 2019 conference. Consensus is one of the largest blockchain conferences in the world. Securitize used the hugely popular seminar to ensure their announcement received the proper attention and publicity the company desired.
A Proven Standard
Discussing the decision, Securitize co-founder and CEO,Carlos Domingo first explained how Securitizes’ Digital Securities Protocol proved itself over the last year. He then took a moment to explain why the decision opens many doors for the company.
Domingo sees a future where developers are now able to create and test Dapps based on the Digital Securities Protocol (DS). Dapps are a crucial component of any token standards in the marketplace. As a result, analysts continually point out that the Dapps propel a project forward.
Dapps are Important
For example, Ethereum is by far the most widely used platform to launch security tokens. In most instances, security tokens launch as a variant to the ERC-20 protocol. The main difference being that these tokens also include the necessary regulatory compliance mechanisms found in security tokens. Likewise, ERC-based Dapps are among the most prevalent in the market.
Now Securitize wants to capture some of the excitement and added functionality that Dapp developers bring to the table. Domingo commented on the need to provide these developers with a viable venue to actually make a difference with the code.
In a company blog post, Securitize elaborates on this theory. Here, Securitize states the importance of their strategy. Basically, the firm spent the last year perfecting their coding and proving that it is reliable enough for real-world use. Now, the DS protocol is ready to go to the next level.
DS Token Protocol
According to the blog post, the goal of the DS protocol is to provide the “proper Digital ownership Architecture to address all aspects of the digital securities lifecycle.” Company officials now hope that the cryptocommunity will step up and really put the DS protocol to the test.
DS Token Code
The newly released coding includes five main interfaces in which developers can interact, test, and build on the coding. The first component is the DSServiceConsumerInterface. This portion of the coding is what enables the other component to interact in a seamless fashion.
Next, the DSTokenInterface is the actual token protocol. As expected, the coding shares many aspects of the ERC-20 protocol but with some key differences. These upgrades include investor-centric balances.
The DSTrustServiceInterface is where developers can assign trust roles in the context of the DS token. This is how developers are able to authorize high-level users and developers within the platform.
A DSRegistryServicesInterface is used to define the Registry Service of the tokens. This is where the token holds all relevant ownership information. Consequently, this section is a critical component when discussing token compliance.
Finally, the DSComplianceServiceInterface is how tokens are able to continually check to ensure compliance throughout its lifecycle. Secondary compliance concerns are a major issue in the security token sector. This protocol is what enables DS tokens to remain within the legal guidelines of digital securities. Importantly, this protocol plays a major role in secondary market compliance as well.
Securitize Steps up its Game
The decision to go open-source is a smart one on the part of Securitize. The crypto sector was built on open-source projects such as Bitcoin and Ethereum. Securitize is now in line to continue this legacy and push its DS token protocol to new heights.
DigiMax Designated ‘Exempt Market Dealer’ by OSC
DigiMax has recently announced that they have successfully been granted a designation as an ‘exempt market dealer’.
This designation, doled out by the Ontario Securities Commission, will allow for DigiMax to issue digital securities on behalf of their client, without the need for a prospectus. As a result, DigiMax will see their advisory, and issuance platform, become more flexible, providing client easier access to capital.
Exempt Market Dealer
For the majority of companies issuing securities within Canada, a prospectus is needed to remain regulatory compliant. There, however, exists a subset within capital markets, which allows for companies to forgo this step. This subset is known as an exempt market, and typically indicates that less protective measures are put in place for companies granted exempt status.
For more information on exempt markets, and those taking part, click HERE.
A prospectus is a form of documentation which is typically required by regulatory bodies, such as the Ontario Securities Commission. The documentation consists of a thorough outlining and description of a companies planned actions, pertaining to a capital generation event.
In making their announcement, DigiMax CEO, Chris Carl, took the time to comment. The following is what he had to say on the matter.
“We are very excited to have been granted registration as an EMD in the jurisdiction of Ontario in Canada…This registration allows us to serve Ontario based corporations and investors as an exempt market dealer in various forms of funding, and to market such offerings to institutional or accredited investors. Working with our growing network of similarly registered dealers in other countries, DigiMax Global Solutions is well on its way to becoming the leader of a global syndicate of dealers able to assist companies to raise capital around the world.”
DigiMax is a Canadian company operating out of Toronto, Ontario. Since operations were launched in 2017, DigiMax has developed a platform which facilitates capital generation events in the form of digital security offerings.
Company operations are overseen by CEO, Chris Carl.
Ontario Securities Commission
The Ontario Securities Commission (OSC), is a government run, regulatory body, which oversees the enforcement of various acts. Each of which has been designed to protect investors through the creation of fair and honest markets.
In Other News
The digital securities sector has seen various large developments as of late. We have seen huge conglomerates make their entrance, while existing industry participants hone their platforms and services. Here are a few noteworthy events from recent weeks.
- Libra to Utilize KoreConX in Upcoming Digital Security Offering June 25, 2019
- Securitize DS Token Protocol goes Open Source June 25, 2019
- DigiMax Designated ‘Exempt Market Dealer’ by OSC June 24, 2019
- Velocity Ledger to Utilize Security Suite through HCL Cyber Group June 23, 2019
- Mt. Pelerin Release STO Launching Service Amidst Path to Full Banking June 22, 2019