The NEO Project’s “NEO Global Development” (NGD) group announced last week that it had formed a consortium to explore and understand the growing digital securities sector. The alliance, dubbed the Digital Asset Alliance (DAA), will endeavor to articulate and document the nuances of security laws as they apply to asset tokenization across different jurisdictions and assets classes.
The DAA opened its new Medium.com blog with this statement:”Digital Asset Alliance is a NEO backed initiative discussing security token related issues. We aim at building an open-source platform for security token life-cycle service providers, and developing best practices for the growth of tokenized networks.”
Helping to foster development and community
The Digital Asset Alliance aims to cultivate consensus, thus enabling NEO blockchain developers, as well as the global blockchain development community at large, to create a legally compliant security token standard. NEO’s NEP-5 standard can already be applied to security tokens, though it is up to the issuer to implement regulatory criteria at the smart contract level.
NGD global business development manager, Tamar Salant, said, “We will be collecting insights and then presenting them to the community and saying, you know, ‘These are the top 10 highest priorities – How do we translate this into code? How do we make sure this is in every smart contract?’ Because we know this is a standard that is very much needed. And I think when we’re looking at securities and digital assets, we’re touching on a few different fields.”
Onboarding industry players
The DAA will bring together a diverse group of parties drawn from what Salant calls the “supply chain of security tokens”: “Our virtual round table is a gathering of people from all across the globe, whether its issuance platforms or projects, or law firms, or liquidity providers, or AML/KYC providers – we’re getting a sense of what everyone is looking at.”
The blog introduced some of the first security token industry players to join the DAA:
- Better Alternatives, an Israel-based boutique blockchain advisory firm working with two STO projects hoping to launch in the U.S. in 2020.
- DLx Law, a New York City-based capital markets law firm pivoting to focus on the security token space.
- Globacap, a London-based STO sandbox regulated under the UK Financial Conduct Authority, going live with it first two STO launches in March.
- Hashgard, a Shanghai-based STO services provider developing its own security token standards.
- Liquefy, a Hong Kong-based STO platform planning to launch its first STO sometime in 2019.
- Republic, a New York City-based crowdfunding platform with a mission to enable retail investors to invest in seed-stage startups.
- Vertalo, an Austin Texas-based security token investor matching, compliance, and cap table solutions provider.
A global blockchain securities compliance hub
The mission of NEO’s existing “Global Blockchain Compliance Hub” repository will be expanded to complement DAA’s mission. Tamar Salant explained, “We’re starting to create specific categories in regards to STOs. So, not just about using blockchain technology or tokenizing assets, but really looking at the existing securities laws. So many regulators out there are issuing sandboxes, and new regulations, and new ‘simple English,’ as the SEC put it, in terms of a kind of framework. So, what we want to do is create a subcategory or just a very specific category within the Blockchain Compliance hub, specifically talking about STOs and digital assets. If there are any community members out there who have a specific interest in securities laws, we’re happy for them to submit.”
Vtoken Exchange Celebrates SEC Filing in Time Square
The largest decentralized exchange in the world, Vtoken, obtained its SEC filing from the United States Treasury Department this week. The firm took to the world-famous NASDAQ billboard in Time Square to celebrate the move. This is the second time the company graced this iconic attraction seen by millions. Also, the move symbolizes further blockchain integration into traditional securities markets.
Speaking on these developments, Vtoken’s Chief Advisor to the Asia Pacific Region explained how his firm plans to cultivate a robust blockchain ecosystem. He took moment to discuss recent global developments in the security token space. Specifically, he touched on how both Chinese and American markets experienced a huge surge in blockchain-based firms.
The Vtoken combines the regulatory protections found in the traditional securities markets with the efficiency of a blockchain -based system. The company offers transfer agents flexible solutions to many of the current issues plaguing the securities markets.
For example, traditional securities can take three days for trades to complete. This delay leaves investors in a less than optimal position. In contrast, Vtoken’s blockchain-based system can complete trades in a matter of hours. Consequently, the platform enables a more nimble trading experience.
Real World Experience
Vtoken is a unique hybrid of technology, compliance, experience, and professional customer service. The firm handles a wide range of clients but specializes in Regulation A transactions. To date, Vtoken’s clients include NASDAQ, NYSE, OTC-listed firms, IPO-issuers, and private investors.
Vtoken’s strategy is unique in that the firm created a complete blockchain ecosystem. Here, investors can get all the information they need to host a compliant STO. The company offers a full range of solutions for both enterprise and private investors. These services include pre and post token issuance and management, smart contract programming, and ownership protection.
The latter feature is unique to V-token. This functionality allows investors to restore lost or stolen tokens, an option not usually available in the blockchain space. More importantly, Vtoken is now in a very exclusive class of decentralized exchanges registered with the SEC.
Vtoken shares many of its core developers with Ripple. Additionally, Vtoken utilizes graphene underlying technology. The token has a trading gateway that is similar to Stellar Lumens. This enables the platform to maintain optimal transaction speeds. Currently, Vtoken can process transactions faster than the third-generation crypto EOS.
Last month, Vtoken made headlines after forming a strategic partnership with blockchain payment platform PayDex. The PayDex platform functions on Vtoken’s public blockchain. The system provides global crypto settlement with support for BTC, ETH, VToken, USDT, VRT, YEC, EOS, LTC, and VUST. PayDex seeks to bring crypto payments to the masses through a simplistic mobile interface.
Vtoken’s all-inclusive approach to the market is crucial to its overall strategy. V-Token provides users with everything they need to become a player in the security token market. You can expect to see this firm continue to make headlines s the platform expands in the coming months.
AlphaPoint and Elevated Returns to Develop Secondary Market
‘Making Illiquid Assets Liquid’ – That is the guiding sentiment behind AlphaPoint, a young company which utilizes blockchain to facilitate tokenization.
This idea is one step closer to becoming a reality, as AlphaPoint has just announced a partnership with Elevated Returns – A forward thinking company which specializes in real-estate.
In this announcement, the pair has indicated that they will be developing a secondary market for trading digital securities backed by real-estate. It is through secondary markets that traditionally illiquid assets, such as real-estate, will become easily tradable – all the while opening up fractionalized ownership, and opportunity for exposure to retail investors.
Elevated Returns will focus these efforts on Asian markets, following their expansion into the region roughly one month ago. At the time, the company acquired a large share in a Thai broker-dealer – a move allowing for them to commence operations through previously attained licensure.
“Elevated Returns prides itself on our reputation as a pioneer in the digital securities space. To that effect, we have a policy to partner with the best in class companies across industry verticals; AlphaPoint’s technology solutions for unlocking digital asset liquidity are unparalleled. Having already demonstrated the capability to integrate with the token standard that we are developing on the Tezos blockchain, AlphaPoint was the clear choice to facilitate the adoption of our tokenized real estate initiatives.”
AlphaPoint is a United States based company that was founded in 2013. With their sights set on ‘making illiquid assets liquid’, AlphaPoint has successfully serviced global customer through their various service offerings.
Since opening their doors, AlphaPoint has seen their diligent work towards growth land them customers in 5 continents, to date.
Company operations are overseen by CEO, Salil Donde.
Elevated Returns is a United States based company, which specializes in investments surrounding real-estate. Recognizing the potential of digital securities, Elevated Returns operates with a goal of acquiring assets viable for tokenization.
One such example was the noteworthy tokenization of the St. Regis Resort; A high-end ski resort that successfully sold digital securities representing ownership within the resort, becoming one of the first to do so.
Company operations are overseen by President, Stephane De Baets.
In Other News
We have detailed developments pertaining to both AlphaPoint and Elevated Returns in the past few months. Check out the following articles to learn a bit more about what each of these companies has been up to in this time.
Due Diligence Process Delays tZERO Investment
In this statement, they indicate that while this investment is on-going, further delay is unavoidable. After initially setting a mid-April deadline, the due diligence process is simply more time consuming than initially thought.
In the update, distributed to its shareholders, Patrick Byrne expressed praise for Makara, while commenting on the tenuous nature of the deal and reassuring readers at the same time. The following are a few excerpts from this statement, highlighting these sentiments.
‘Makara’s due diligence has progressed, and in the course of its due diligence Makara has proven to be a professional and serious fund. Still, the parties will not have a definitive deal in place by the mid-April target.’
‘tZERO plans to continue facilitating Makara’s diligence, but is not under any exclusivity with Makara or GSR and has retained advisors to pursue parallel alternatives. We will update shareholders after tZERO signs definitive documents.’
‘Our retail firm is recovering more dramatically than I anticipated and discussed during our Q4 2018 earnings call. In addition, tZERO is on track to introduce the products described in that phone call. Our intense focus on execution is paying off.’
This news may be slightly disheartening, as it represents, not the first, but second hiccup in the investment process. Despite this setback, tZERO has been on a tear over the last year. They are not being held back by this process.
tZERO has their hands in many pots, with endeavours resulting in the launch of a trailblazing secondary market for digital securities. Beyond this, tZERO has seen progress through adoption, and the awarding of patents.
Founder, Patrick Byrne, has reiterated his strong belief in digital securities multiple times over the past year. He has gone so far as to shift his entire focus from Overstock to tZERO and its ongoing development. Unmoved by ‘crypto winter’, Patrick Byrne has, in the past, commented to The Wall Street Journal, on the potential of tZERO. He stated, “I don’t care whether tZERO is losing $2 million a month…We think we’ve got cold fusion on the blockchain side.”
In Other News
tZERO is a regular in our news feed, as they have been pivotal in establishing the digital securities sector in its infancy. Below are a few articles detailing past developments pertaining to this impressive and important company.
- Vtoken Exchange Celebrates SEC Filing in Time Square April 20, 2019
- AlphaPoint and Elevated Returns to Develop Secondary Market April 19, 2019
- Due Diligence Process Delays tZERO Investment April 18, 2019
- Brian Collins, CEO at Horizon Globex – Interview Series April 18, 2019
- ST8 Launched in an Effort to Help French SMEs April 17, 2019