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TokenSoft Global Markets adds Coinbase Custody, expanding Security Token services

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TokenSoft Global Markets adds Coinbase Custody, expanding Security Token services

Custody Solutions

Only days ago, we were reporting on the acquisition of broker-dealer ‘Marpine Securities’, by TokenSoft.  As a result, this move saw the creation of new arm of TokenSoft, known as ‘Global Markets’. One of the benefits of this acquisition was the ability to now refer third-party custody solutions to their customers.

Today, wasting no time at all, the newly created TokenSoft Global Markets, has announced that they have established a custody agreement with Coinbase.

As a result, this means that will have the choice of utilizing either TokenSoft, or Coinbase Custody as the custodian of their holdings. By providing this option, each company benefits from both the services and reputation of the other. TokenSoft instantly gains more clout, while Coinbase becomes more diverse.

Coinbase Custody

Coinbase Custody first went live in July of 2018. By offering custodial services to institutional investors, Coinbase is directly addressing a commonly agreed upon weak-point in the industry.

In the time since the service went live, Coinbase has added various supported assets, in addition to gaining licensing from the State of New York.

As the name would suggest, the main purpose of this service is simple – to safeguard an investor’s holdings. Coinbase General Manager, Sam McIngvale, commented on integration with TokenSoft.   He stated, “By working together, Coinbase and TokenSoft will help projects get to market faster while maintaining compliance. Right now, there’s too much friction and complexity in the token issuance process. We need to change that…As a qualified custodian, Coinbase Custody provides asset issuers a strong foundation for their projects, offering institutional-grade security, financial controls and auditability. Paired with TokenSoft’s affiliated broker-dealer, TokenSoft Global Markets, Coinbase seeks to bridge the gap between a client’s vision and its ability to raise and securely store the funds during a security token sale.”

TokenSoft Global Markets

TokenSoft Global Markets is a newly formed arm of TokenSoft. Technology provided by TokenSoft, will power this while acting as a broker-dealer.

Mason Borda, CEO of TokenSoft, commented on the integration of another custody solution. He stated, “In many instances, issuers are looking for someone to manage the security and compliance of custody for them. The current options aren’t fully integrated, use omnibus accounts, and don’t provide the level of data granularity necessary to meet the standards of top accounting firms…Additionally, Coinbase’s approval in one of the strictest jurisdictions, New York, gives everyone a lot of comfort. This new custody relationship will enable our issuers to simply work with one of the most well-known custody platforms in the industry, providing them with security, compliance and peace of mind.”

Coinbase

Functioning out of San Francisco, and founded in 2012, Coinbase is a titan in the world of blockchain. They are trailblazers, and set the standard on many services offered.  Coinbase has grown into a company valued at over $8 billion.

Going beyond commenting on the Custody integration, specifically, Sam McIngvale touched on their view of TokenSoft. He offered high praise, stating, “The TokenSoft platform and its team have truly differentiated themselves with their attention to detail and commitment to compliance and security…We’re excited to work with our common clients to support the future of security token management.”

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Joshua Stoner is a multi-faceted working professional. He has a great interest in the revolutionary 'blockchain' technology. In addition to this, he is a licenced Paramedic in Nova Scotia, Canada. As such, he can provide emergency care/medicine to any situation necessitating it.

Blockchains

FastForward Announces Factom Inc. to Enter Receivership

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The Factom protocol is seeing one of its first adopters, Factom Inc., potentially taking its final steps, as the company enters receivership.

While the Factom protocol, itself, was developed and nurtured through its infancy by The Factom Foundation, this board has long since dissolved.  This dissolution occurred after years of developing the protocol, to a point where it was able to operate on its own, in a decentralized fashion.

Unfortunately, Factom Inc., which utilizes the Factom Protocol, has not fared well with the current economic climate, resulting in the current situation.

Factom Inc.

Factom Inc. while intimately related to the Factom protocol, does not represent the Factom Ecosystem as a whole.  They are simply one company, which builds solutions utilizing the open-source and decentralized protocol.

Some of the solutions Factom Inc. has built include,

Intellectual property surrounding these solutions, as well as company assets, will now find themselves in the hands of primary creditor, FastForward.  As such, FastForward will facilitate the upcoming receivership process.

Will FastForward rebrand Factom Inc.? Will they liquidate assets? Will they simply restructure?  Time will tell what this process entails.

Authority Node Operator (ANO)

As an open-source and decentralized protocol, the Factom blockchain is managed through a series of Authority Node Operators (ANOs).  These companies, all of which must meet eligibility requirements and undergo trialling, are described as block validators.

Currently, there are 27 different companies which hold this position, with Factom Inc. being one of them.

The Writing was On the Wall

News of Factom Inc. entering into receivership should not come as a complete surprise.  On March 19, 2020, Factom Inc. creditor ‘FastForward’ indicated that this may happen.

In their update at the time, the company had the following to say,

“…at the end of March 2020, without any additional support or funding, Factom Inc. will be forced to enter discussions with creditors about the distribution of its assets.”

Needless to say, additional funding did not materialize, resulting in the development discussed here today.  On April 2, 2020, FastForward announced the decision by Factom Inc.

Ed McDermott, Director of FastForward stated,

We are extremely disappointed with this news from Factom. In light of this Dissolution Event under the SAFE we are taking swift action to protect our position as best we can in the circumstances albeit the ability to generate any meaningful return is uncertain. As we go through the Receivership process and understand more of the events that led to this position our position as investors in Factom is expressly reserved.” 

Receivership

Receivership is a process built to allow for creditors to gain control of a company.  This occurs in an effort for them to either impart restructuring efforts, or liquidate assets.

The purpose of which is to allow for an opportunity to bring the company back to profitability, and/or reimburse creditors their funds.

On-Going Applications

While these may be dark times, there do remain a few promising applications/implementations of the Factom Protocol, which are expected to be unaffected by the receivership proceedings of Factom Inc.  The following are a couple examples of this.

PegNet

Launched in October of 2019, PegNet is an example of one of the more promising, and successful, applications which utilize the Factom Protocol.  It is also an example of one of the applications not associated with Factom Inc., which will continue to operate unaffected.

To date, PegNet is said to have already facilitated over $1 billion in transactions.

Factom Asset Token (FAT)

The FAT protocol is another example of a project built atop the Factom blockchain.  This one, in particular, holds the promise and flexibility to support digital securities.

We previously took a brief look at how FAT operates, including its ability to support non-fungible tokens.

Security Token Standards – Factom Asset Token (FAT)

Past Successes

There is an unfortunate trend in the world of cryptocurrencies and blockchain – an attraction to hollow, ‘get rich quick’ schemes.  Visit the top companies listed on coinmarketcap.com, and you’ll see it populated with many companies which have, to put it bluntly, accomplished next to nil.

Unable to crack the top-100 coins by marketcap for months now, Factom, is not one of these.  Overall, the Factom blockchain, and the various solutions built on top of if, have experienced quite a few successes and legitimate adoption over the years.  Arguably the most prominent, and well known, example of this is their proclivity for attaining subsequent government grants and pilot programs.  While the protocol lives on, unfortunately, these examples were not enough to save Factom Inc. from its current situation.

If a company and the protocol it is built upon, which has received this amount of attention from reputable organisations can suffer, so can any.

In Other News

Beyond what has been discussed here today, the following articles touch on multiple recently announced utilizations of the Factom protocol.

Knabu to Utilize IdentityMind and Factom in Pilot Program

Sphereon Chosen to Integrate DAML with Factom Protocol

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Token Solution Providers

Bakkt Marching Towards Summer Launch of Consumer App, While Closing $300M Series B

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$300 Million

While crypto markets remain in a state of flux, as the world deals with the ongoing effects of COVID-19, there is one company trucking along, un-phased.  Bakkt, the popular digital asset service provider, has announced the successful completion of their Series B.

This event saw the company bring in a total of $300 million from a variety of investors.  This brings their total raised, to date, to nearly $500 million between each of their raises.

Participants

In the process of raising such a hefty sum, Bakkt saw the participation of a variety of companies in their Series B.  The following is a list of companies which saw/see the promise of Bakkt, and decided to align their goals with the young outfit.

  • CMT Digital
  • Pantera Capital
  • Goldfinch Partners
  • M12
  • Intercontinental Exchange (ICE)
  • PayU
  • Boston Consulting Group

If these names ring a bell, this may be, in part, due to their participation in Bakkt’s initial Series A.  With a second investment by multiple companies, it would appear that Bakkt has managed to make a good impression on all involved, as they have navigated a tumultuous market through their lifespan.

Consumer App

The Bakkt consumer app, which is scheduled to launch in the summer of 2020, is more than simply another wallet for holding digital assets.  The app brings with it multiple features that allow it to stand apart from the pack, and entice mainstream adoption.

Bakkt has stated that the app will be based upon 4 main features which allow for its user to:

  1. Aggregate a variety of assets which range from crypto, to cash, loyalty points, and even in-game rewards
  2. Seamlessly convert each/any of these assets to Bitcoin, cash, and more
  3. Trade supported crypto assets securely within the app
  4. Payments through the app, or through use of a ‘Bakkt Card’.

For many, their wallets are full of loyalty cards; Cards which have unused loyalty points.  Unsure of what to use those air miles on? Simply link them with the Bakkt App, and utilize them in any manner you see fit through the listed features above.

Essentially, what the Bakkt app does is maximize the efficiency and flexibility of loyalty programs and digital assets, while providing an outlet for their redemption and use.

Commentary

Upon announcing today’s news, Bakkt CEO, Mike Blandina, took the time to share his excitement.  The following statement touched on the scope of what the company has achieved in their 2 years since launch.

Mike Blandina states,

I’m excited at our potential to unlock nearly $1 trillion of digital assets when the Bakkt app launches this summer. With the completion of our Series B financing and recent acquisition of Bridge2 Solutions, Bakkt is now a team of 350 employees and powers the loyalty redemption programs for 7 of the top 10 financial institutions and over 4,500 loyalty and incentive programs including two of the largest US airlines. We have the unique opportunity to leverage the technology, infrastructure and partners across our businesses to bring innovative new products to market and in doing so expand access to the global economy.”

CPO to CEO

Despite only launching 2 years ago, and widely being deemed a success thus far, Bakkt has already seen a change of guards atop the company.  This change was the recent promotion of Mike Blandina from CPO to CEO.

It is important to note however, that the exit of Kelly Loeffler was not due to inadequacies in performance, but rather an opportunity that could not be passed up – a seat on the United States Senate.

This opportunity for Mike Blandina was not simply a stroke of luck.  Upon his promotion, Bakkt mother company, ICE, noted his vast experience as a major boon.

ICE CEO, Jeffrey Sprecher, stated,

“As CEO, Mike will chart Bakkt’s strategic direction, payment products and markets, as well as overseeing the regulatory and financial performance of the company…His more than 25 years of experience in payments across product, engineering, strategy and operations will continue to serve us well.”

Beacon of Hope

When Bakkt first launched in 2018, it was during a dark time in the world of crypto/blockchain.  The entire industry was in the midst of what became known as ‘crypto winter’.  Their entrance into the sector was much heralded, and represented a beacon of hope for things to come in the months leading up to launch.

Fast forward to 2020, and Bakkt is once again providing a glimmer of hope for the future through their highly anticipated consumer app.  This hope is perhaps needed more than ever, as uncertainty surrounds, not just crypto and blockchain endeavours, but the overall stock market; Uncertainty which appears poised to remain while markets deal with the global pandemic of COVID-19.

Major advancements by a major company, being made in the dark times of a suppressed market.  Let’s hope that this summer’s release of the consumer app exceeds already high expectations.

Bakkt

Founded in 2018, Bakkt is a subsidiary of the Intercontinental Exchange, operating out of Atlanta, Georgia.  Above all, the team at Bakkt are working to develop solutions surrounding digital assets.  These solutions range from futures contracts, to the upcoming consumer app, and more.

CEO, Mike Blandina, currently oversees company operations.

In Other News

While the motive of each company is different, Bakkt shares their successful raise with various others to do the same in recent months.  The following articles detail a few of these events, which saw promising companies bring in millions in investments, ranging from 5M to $200M.

Horizon Globex Shakes Up the Team, While Hosting a Successful Series A

Securrency Pulls in $17.75M During Successful Series A

Ripple Attains $10 Billion Valuation after $200 Million Series C

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Exchanges

ECSE to Enter STO Pilot Program with Blockstation

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Pilot Program

Another securities exchange, the Eastern Caribbean Securities Exchange (ECSE), has seen the merit behind digital securities, and signed a fresh letter of intent (LOI) with Blockstation.

This letter represents an upcoming pilot program, which will see Blockstation act as a service provider for the ECSE.

With Blockstation touting a comprehensive tokenization platform, this means offering a variety of capabilities.  It is anticipated that these will allow for the ECSE to support the trading of various assets, such as BTC, ETH, and, of course, STOs.

Caribbean Presence

At this point, it would appear as though the Caribbean has spoken, and made their choice of service provider clear – Blockstation

Each of the following are examples of pilot programs involving Blockstation that have either been completed, are off the ground, or are about to launch.

  1. Jamaica Stock Exchange
  2. Barbados Stock Exchange
  3. Eastern Caribbean Securities Exchange

Features

With regards to the LOI, the ECSE has indicated that they intend to leverage the Blockstation platform, providing their clients with access, but not limited, to the following perks:

  • asset insurance
  • compliant KYC/AML measures
  • SLAP (a Blockstation solution which provides companies looking to host an STO with a streamlined process for creating a prospectus)

Commentary

Upon announcing this newly signed partnership, representatives from each, Blockstation and ECSE, took the time to comment.

Trevor Blake, Managing Director at the ECSE, stated,

“The ECSE is proud to take a leading role in increasing access to and participation in our securities market through digital assets…This pilot follows the pilot being undertaken by the Eastern Caribbean Central Bank (ECCB) of a digital EC dollar (DXCD) that will be the world’s first central bank-backed digital currency, supporting the ECCB’s goal to remove financial frictions, promote financial stability, and expedite growth and development in the member countries of the Eastern Caribbean Currency Union (ECCU).”

Matt Singh, VP of Sales at Blockstation, stated,

“It’s inspiring to see the vision of shared prosperity resonate so strongly in our conversations with the ECSE and financial regulators in the region…We look forward to advancing the ECSE’s goals of leveraging the blockchain to bring transparency, improved security and new economic opportunities to their citizens and global investors.”

Speaking with Marko

In our ongoing interview series, we were fortunate to have recently interviewed the President and CEO of Blockstation, Marko Hafez.  In this discussion, we learn more about what Blockstation has to offer, and how they found themselves helping exchanges like the JSE transform the way they operate.

Interview Series – Marko Hafez, President & CEO of Blockstation

Blockstation

Since being founded in 2015, Blockstation maintains headquarters in Toronto, Ontario, Canada.  Blockstation looks to service and establish the digital securities sector, through their comprehensive tokenization platform.

CEO, Marko Hafez, currently oversees company operations.

Eastern Caribbean Securities Exchange

Acting as a subsidiary of the Eastern Caribbean Central Bank, the ECSE maintains operations in the island nation of St. Kitts.

CEO, Trevor Blake, currently oversees company operations.

In Other News

For those that may recognize the ECSE mother company, ECCB, it may be due to recent news of their decision to create a central bank digital currency.  The ECCB fully intends to be first to market, globally, with their own digital variant of a central bank issued currency.

ECCB to Issue World’s First Blockchain-based Digital Currency

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