Security token investors have much to celebrate this week as the San-Francisco based consulting firm, Newtown Partners, released their long-awaited security token market overview. The primer is one of the first to cover the developing security token sector. The report provides investors with valuable insight into the current state of the market.
Additionally, the paper highlights the past developments of the space and the emergence of major platforms. The security token market expanded significantly over the last year. Both investors and businesses entered this sector with the goal of reducing risk and improving efficiency in the market. The rate at which this influx occurred left new security token users with a serious lack of reliable market information.
Recognizing the lack of reliable market statistics, Newtown Partners has set out to add some much-needed clarity to the industry. The report includes insightful information such as the “Evolution of the Narrative Around Security Tokens.” In essence, this primer provides you with all the information you need to get up to speed in the security token sector.
Newton Partners entered the market in 2016 as a blockchain advisory firm. The company specializes in token economy design, implementation, and development. The company has a long list of accomplishments in the blockchain space including working on Augmentors, Civic, and Wala.
The firm’s founders, Llew Claasen and Vinny Lingham, are no stranger to the crypto sector. Claasen is the Executive Director of the Bitcoin Foundation in the US. He works very closely with numerous countries’ regulatory agencies. Lingham also has a very strong technical background gained through his years of experience working in Silicon Valley.
One of the most interesting sections in this primer is the Market Landscape information. Here, the primer describes the different type of regulations currently in use. Additionally, a chart is included that covers the most blockchain active countries stance on the market including their regulatory framework.
The data includes a plethora of helpful visuals including a partnership landscape chart. You can see which firms hold the most market influence. According to the data, Polymath has the most strategic partnerships at this time. There is also a section regarding the different types of platforms, their functionalities, and a list of examples of each kind. These include categories such as:
- Token Exchanges
- Hybrid Platforms
- Incumbent Stock Exchanges
- Ancillary Projects
- In Production
Newtown Partners include an in-depth analysis of the most significant STOs that occurred to date. According to the data, tZero holds the title as the most successful STO to date. The platform secured $134 million during their STO.
The “Concerns and Areas Still to Be Proven” section of the paper highlights difficulties that must be overcome in order for the security token sector to flourish. The paper lists liquidity, lack of infrastructure, and the shift from intermediary services to Peer-to-Peer as the main problems facing full-scale adoption. The report explains how certain third-party intermediaries are difficult to codify at this time.
You have to hand it to Newfound Partners for putting together a well thought out primer. This document sheds some light on the entire security token sector. This information is sure to bolster confidence in the market and further investors’ desire to participate in this emerging technology. You can download the full primer here.