The crypto exchange platform VNX has made a significant announcement this week regarding the development of a new security token protocol. Company executives announced a partnership with the decentralized application platform NEM. The two crypto firms seek to bridge the gap between the crypto economy and traditional financing firms.
The partnership is geared towards creating and funding a wave of new security tokens based on the NEM blockchain. NEM recently made headlines for its power to cultivate productivity after becoming the token launch platform chosen by the blockchain-based Publish platform. The platform is a joint venture between TokenPost, the largest blockchain news media outlet in Korea, and the blockchain consulting group Kchain.
In a recent interview with Cryptoninjas.net, Alexander Tkachenko, the CEO and Founder of the VNX Exchange speaks on the new opportunities the partnership will bring to the market. He spoke on the importance of creating a worldwide security token ecosystem to increase access to traditional VC markets. He also touched upon the advancements that blockchain technology brings to financial markets globally.
Alexander wasn’t the only company executive to praise the partnership. Kristof Van de Reck, the Interim President of the Nem.io Foundation also discussed the opportunities gained from the venture. He explained how the connection was essential to bridging the gap between the mainstream financial industry and the growing cryptomarket. He also discussed how NEM is excited to delve into the security token sector.
VNX specializes in venture capital. The platform currently hosts $169 billion in yearly VC investments. These investments span the gambit of Fintech with over 10,000 startups funded yearly. VNX executives understand that over 80% of research and development conducted by major companies requires VC funding. VNX seeks to open the VC process up to new investors through the integration of blockchain protocols.
NEM is considered a fourth-generation blockchain application platform. The platform offers users a combination of flexibility and scalability which is far ahead of many blockchain launching platforms. NEM utilizes a unique consensus mechanism called Proof of Importance. The Proof of Importance protocol eliminates many of the problems found in both Proof of Work systems and Proof of Stake protocols.
The NEM protocol prioritizes accounts through the use of a proprietary algorithm. Each account receives a rating not based on their computing power such as Proof of Work systems. It also avoids the downfalls of Proof of Stake systems by not prioritizing accounts based on their holdings.
NEM and VNX Ready for the Future Cryptomarket
Security tokens continue to gain popularity. These coins combine traditional financial system requirements with the ease-of-use and efficiency of blockchain technology. This latest partnership signals an increased push in this direction by major blockchain firms.
This year has already seen a myriad of new security token protocols emerge in the marketplace. Blockchain firms such as Polymath, Securrency, and Harbor all have entered their protocol into the security token race. Considering the tremendous amount of capital that these firms are unlocking, you should expect to see this trend continue in the coming months.
KoreConX partners with SME Brokers
It was announced recently by KoreConX that they have partnered with and Australian start-up, known as SME Brokers.
This partnership entails SME Brokers exclusively using the platform offered by KoreConX. In doing so, they will bring the benefits made possible through digital securities to their network of enterprises. With a portfolio of over 60,000 SMEs worldwide, their reach is far extending. Each of these companies will now have the ability to issue their own security tokens with ease.
This platform, offered by KoreConX, utilizes their very own security token protocol. These are known as KoreTokens. These KoreTokens incorporate AI to self-govern. This means that these tokens will always remain compliant to regulations throughout their lifecycle.
It is this type of flexibility afforded through KoreTokens and the KoreConX platform that attracted SME Broker. With KoreConX currently undergoing their very own STO, and utilizing the KoreToken for the process, they should be well set to make their mark in the industry.
Undergoing a recent expansion, SME Brokers now find themselves with operations on both Wall Street, and in the heart of Silicon Valley.
The team at KoreConX describes themselves as a utility knife. Their developed platform is diverse in its functionality. Through it, they are able to provide any needed assistance to a company throughout their growth cycle.
In recent weeks, KoreConX has announced similar partnerships with both Evoke Capital, and BlockchainAgility. Those that have come on board to utilize the KoreConX platform are part of what they call the ‘KorePartner Ecosystem’.
Commenting on the SME Broker integration was KoreConX CEO, Oscar Jofre. He stated, “As a global platform, it is important for us to demonstrate we have KorePartners who understands our business and supports it 100%. SME Brokers is just that partner for us at KoreConX. They understand small and medium-sized companies and see the changes in the global marketplace…This is why they support our security token protocol and platform exclusively in Australia, and we are thrilled to have them part of our family of KorePartners.”
With the developing of their KoreToken, KoreConX has broken the mold of utilizing ERC-20. In recent weeks they have spoken out on their protocol. They believe it will better serve not only companies like SME Broker, but the industry as a whole.
Through its access to various forms of management and development programs, SME Brokers is able to aid the growth of their network of SMEs. Now, with this partnership, their toolbox for helping companies grow has grown even larger.
SME Brokers’ managing director, Michel Aliphon, spoke on the use of the KoreConX platform. He stated, “We always strive to provide the best solutions to our clients. We can rest assured knowing that KoreConX developed a security token protocol and an all-in-one platform that is mainly focused on compliance and follows the regulations in multiple jurisdictions.”
Vertalo Partners With Securrency, Integrating Protocols Into Platform
This platform integration will allow for Securrency to benefit from the cap table services, compliance oversight, and other offerings by Vertalo.
One such offering will be open to those that issue their own security tokens via Securrency. They will now gain access to Vertalo’s ‘Liquidity Enablement Platform’.
What all this means is that companies interested in issuing their own digital security, can do so with relative ease. They will be able to rest assured, knowing that their issued tokens are fully compliant with securities regulations. At the same time they will also benefit from an increase in coveted liquidity.
These protocols are known as CAT-20, and CAT-721. Each are tailored for use as security tokens. CAT stands for Compliance Aware Token, and is marketed as an ‘interoperable ledger-agnostic security token protocol’.
After issuance, these tokens can be utilized on any blockchain. This may range from ETH to EOS, and even STR. These tokens inherently govern themselves, to ensure constant adherence to regulations.
The announcement of these protocols was made in early October in a press release. Here, Securrency CEO, Dan Doney, stated, “We developed the CAT-20 and CAT-721 standards because security tokens should be truly liquid – they should not be limited to one ledger and they should be easy to trade, transfer and regulate…This new protocol will enable speed, efficiency and transparency for issuers – from Wall Street to Main Street – while meeting compliance at a global scale.”
Founded in 2017, Vertalo is based out of Austin, Texas. They specialize in both compliance and communication services, for companies based on blockchain.
Speaking on the partnership with Securrency was Vertalo CEO, Dave Hendricks. He stated, “Securrency has identified compliance as a precondition for adoption of digital assets by regulated financial institutions. Through its integration with Vertalo’s Registry and compliance service, Securrency enables issuers, broker-dealers and custody platforms to launch offerings that eliminate regulatory hurdles and meet internal risk management requirements.”
With other partners such as OpenFinance, Polymath, PrimeTrust and more, Vertalo is set to become a major player within the security token industry in the coming years.
Founded in 2015, Securrency is based out of Washington, D.C. They are a technology company that facilitates the issuance and trading of digital securities.
Speaking on the partnership with Vertalo was Securrency CEO, Dan Doney. He stated, “Through this unique pairing, Vertalo and Securrency will be able to provide their clients with the promised compliance alongside improved liquidity for their assets, thus ensuring a seamless trading process unparalleled by other organizations. We believe that this collaboration will help us follow through on our commitment to simplicity and transparency for our clients.”
Malta To Have First Gold Back Security Token
The crypto friendly country of Malta is again in the news after the signing of a Memorandum of Understanding (MOU) regarding the issuance of precious metal-backed tokens. The agreement explains the intent of the Canamex Gold Corporation to issue a gold and silver backed token.
These security tokens are the first precious metal-backed tokens to receive official licensing from a government. Canamex Gold Corporation plans to list their new tokens on the Malta Digital Exchange (MDX). There are significant advantages that the MDX partnership brings to the equation.
For one, MDX is based in Malta. Malta is a pioneer in the blockchain space. The country was one of the first in the world to release crypto legislation which included specifics regarding distributed ledger technology. It is this regulatory framework which makes Malta an ideal location for blockchain-based businesses.
Speaking on the strategic partnership, MDX CEO Rick Klink discussed the advantages gained from working with Canamex Gold Corp. He spoke on blockchain technology and its ability to “democratize capital markets globally.” He explained how the transparency provided by this innovative FInTech is essential for the development of the market.
Last month MDX announced the launch of their institutional grade security token platform. After recognizing the growing need for more regulatory measures, executives decided the security token arena fit the company’s goals. The platform utilizes Paritech technology that simplifies the trading process. Additionally, the exchange received licensing from the Malta Financial Services Authority.
MDX Adds Liquidity
MDX will provide a secondary trading market for Canamex Gold’s GOLDUSA and SILVERUSA tokens. Canamex Gold’s CEO described the partnership between the two as an exclusive deal that has the potential to “move the needle” in terms of security token adoption.
By speaking on “moving the needle.” Klink pointed out the fact that the concept of precious metal backed tokens is not new. Numerous firms such as GOLDX have offered similar services since the beginning of the year. The Russian government even discussed the concept in September 2018. What makes the MDX partnership deal unique is the use of security tokens.
Security tokens adhere to strict government standards. Unlike utility tokens, all security token offerings require the token issuer to provide company information such as financial statements, management process, and company location.
These requirements protect investors from the high level of fraud committed in the cryptospace every year. The Statis Group conducted a study that found that 80 percent of ICOs in 2017 were scams.
Likewise, investors must provide additional information when compared to a traditional utility token transactions including undergoing identity verification. There are no anonymous security token transactions. Security tokens follow securities guidelines.
Malta Sets the Stage
Both the US and EU have shown signs of hesitation when approaching the regulatory framework needed to further security token adoption. The Maltese Parliament saw the need for detailed crypto regulations and took the initiative. Now, Malta intends to take the lead in security token adoption.
- KoreConX partners with SME Brokers November 16, 2018
- Vertalo Partners With Securrency, Integrating Protocols Into Platform November 15, 2018
- Malta To Have First Gold Back Security Token November 14, 2018
- Ripple files ‘Notice of Removal’ November 14, 2018
- Bitstraq Granted Maltese VFA Licence November 14, 2018