Global Digital Finance Registry
In a rapidly developing industry, a growing list of companies have recognized a need for, not only uniformity in the interpretation of regulations, but accountability as well. To facilitate these goals, a non-profit organization, known as Global Digital Finance Registry, has been formed. This organization operates under the following mission statement:
‘The global formation and distribution of capital has value to both new market entrants and incumbents in financial services. Global Digital Finance endeavours to drive efficient, fair and transparent crypto asset markets by building a knowledge base and best practice for “Truly Digital” finance and the benefits tokens can bring all market participants.’
Simply put, its purpose is to create a community comprised of industry participants, in an effort to foster industry growth in a fair and transparent manner.
Members of the registry are able to indicate their adherence to a variety of code-of-conducts, outlined by the GDF. Tokeny in particular attests to Codes 1,2, and 3.
- Overarching Principles
- Principles for Token Sales
- Principles for Token Platforms
- Principles for Funds and Fund Managers
- Principles for Ratings Websites
The GDF launched in 2018, and maintains headquarters in London, United Kingdom.
The founding members of the Global Digital Finance Registry were announced roughly 6 months ago. These members consisted of the following companies.
- DLA Piper
- Hogan Lovells
To meet the goals of the endeavour, new participants are needed to ensure continued expansion and adoption of the code of conduct. Upon applying for membership, entrants are able to indicate which of the 5 codes-of-conduct they pledge an adherence to.
We reached out to Tokeny for comment on their decision to join this registry, and what benefits it will afford both Tokeny and their clients.
Luc Falempin stated,
“In order for digital securities to succeed it is essential there is a standardised association across global jurisdictions and regulators. By joining the GDF, we are helping drive this digitisation of capital markets by contributing to a community that is helping shape this standardisation of conduct.” He continued, “We are joining a community of policymakers, regulators, bankers and other market participants to encourage and develop best practices in the issuance of digital securities.”
Tokeny had to following to say upon announcing their participation in the GDF. It was stated,
“For digital assets to gain mainstream adoption it’s imperative there is a co-ordinated response across global regulators and jurisdictions. Key to this is standardised terminology. To help encourage this we’ve registered with the Global Digital Finance Code of Conduct, an industry-led initiative driving best practices to enable the digital assets industry to flourish.”
Tokeny is a Luxembourg based company that was founded in 2017. CEO, Luc Falempin, has guided this young company along its path towards transforming digital securities. The Tokeny platform has seen modest levels of adoption in recent months, as they have played host to a variety of STOs. These events have/will see Blockport, VR Bank, and others tokenize and distribute assets.
In Other News
The Global Digital Finance Registry is not the only grouping of companies hoping to secure a bright future for digital securities. In recent months, we have seen the formation of the ‘Millbrook Accord’, and the ‘Digital Securities Alliance’, among others. Here are a couple of articles detailing each of these groups.
Bankhaus von der Heydt Unveils Blockchain Strategy
This week, the German Bank von der Heyd stunned the EU banking community after revealing plans to issue security tokens and offer custodial services in the coming weeks. The news demonstrates further integration of blockchain technology among the EU’s traditional banking sector, as well as, a desire by Bankhaus von der Heydt to become the industry leader.
News of the new services first broke via a press release. In the release, the private bank shed some light on the project and the progress to date. Company documents revealed that the bank completed its first custodial transactions successfully this month. Additionally, the blog gave some insight into the bank’s future intentions.
According to reports, Bankhaus von der Heydt will provide commercial clients the ability to tokenize assets via the platform. In this way, bank officials seek to become a major force in the German blockchain sector. Additionally, the bank has plans to issue a EURO-backed stablecoin in the coming months to supplement its digital asset economy.
The new products make Bankhaus von der Heydt the first German bank to provide a digital asset custody solution to clients. As such, the firm hopes to achieve a significant strategic advantage over the competition. Discussing the new strategy Bank von der Heydt managing director, Philipp Doppelhammer spoke on his firm’s work. He explained that bank researchers spent years observing the blockchain space. This research helped the firm to design relevant products to the current state of the market.
Doppelhammer also explained why these products provide his firm with outstanding added value. As the only German bank to offer licensed digital asset custodial services, Bankhaus von der Heydt is positioned to be a major player in the EU markets. Lastly, he took a moment to let the public know that these products are now ready for the market from a regulatory and technological perspective.
In order to ensure the success of the venture, Bank von der Heydt collaborated with FinTech and blockchain services provider, Bitbond. For its part, Bitbond provided the technical infrastructure surrounding the custodial aspects of the strategy. Additionally, the bank utilized Bitbond’s proprietary technology to develop several asset structuring and asset servicing products as well.
Speaking on the partnership, Radoslav Albrecht, CEO, and founder of Bitbond explained how his firm continues to work with several banks and financial intermediaries to expand the capabilities of the platform. He also touched on the important benefits tokenization brings to the market, such as liquidity.
Additionally, Albrecht described the feeling of excitement surrounding the project. Here he pointed out that this was the first project to use blockchain technology in the area of securitization and private placements in the country. He also stated that his firm was “pleased to cooperate” with the bank, which he labeled a proven industry expert.
Bankhaus von der Heydt Takes the Lead
It now appears that Bankhaus von der Heydt will have a strong positioning in the market moving forward. This firm continues to utilize its unique stance to keep up-to-date on all the latest FinTech trends. You can expect to hear a lot more from this group as its new projects gain popularity in the coming weeks.
CFTC to Give its Stance on GRAM Token Classification
This month, the Securities and Exchange Commission (SEC) stepped up its battle against the mobile messaging giant Telegram. For months, the two groups have been enthralled in a trial to determine the classification of Telegram’s GRAM token. This week, in an attempt to break the legal stalemate, the SEC reached out to the Commodity Futures Trading Commission (CFTC) to hear its stance on the project.
According to reports, a letter was sent from the federal judge presiding over the case, Kevin Castel, directly to the Office of General Counsel of the United States Commodities Futures Trading Commission. Specifically, the letter asks the organization to determine if the GRAM token is a security or not.
As such, the importance of this document can’t be overstated. The court’s determination will have a direct effect on the classification of certain types of cryptocurrencies within the United States moving forward. For its part, the SEC argues that the GRAM token is, in fact, a security.
Regulators stated that the entire crowdfunding event, which raised around $1.7 billion, violated the Securities Act of 1933. On top of the claim, SEC alleges that Telegram participated in the unauthorized sale of securities. Lastly, the SEC also claims the group convoluted the difference between a purchaser’s investment in the digital asset and the delivery of the asset itself.
Telegram Refutes the Charges – GRAM
Despite the heavy-handed approach the SEC has taken, Telegram continues to stand its ground. The firm insists that its GRAM token is a commodity. As such, Telegram stated that GRAM tokens do not fall under the SEC’s jurisdiction.
Recent court filings shed some light on the details of Telegrams 2018 ICO. According to these documents, Telegram raised $1.7 billion from 171 investors. Of these investors, $424.5M came from 39 US-based investors. The remaining $1.28 billion in funding came from international participation from 132 additional investors.
What is the GRAM Token?
The GRAM token project originated with the goal to provide Telegram users with an online currency to supplement the Telegram platform. Developers envisioned a cryptocurrency that saw global usage among Telegram’s 300 million subscribers. According to company executives, the hope was to spur the growth of a new economy that would use Telegram as the man medium of communication.
So Are GRAM Tokens Security Tokens?
While the SEC continues to drive home their perspective on Telegram’s blockchain projects, the cryptocommunity awaits a final answer. As it stands today, several filings were made with no relevant determinations yet. Telegram executives and regulators are keen to the fact that this case would set a major precedent across the entire US blockchain sector.
When you consider the ramification of the Telegram trial, it’s easy to see why company executives are not willing to bow to the SEC’s pressure. For one, the firm has billions in funding to fight a long-drawn-out court battle. Additionally, Telegram executives have put forth a lot of effort into the creation and maintenance of the GRAM ecosystem. To lose these funds, would be a huge hit for the firm.
Securitize Receives Backing from Sony
In a sign of the changing times, the Japanese conglomerate Sony announced an investment into the security token issuance platform, Securitize. Sony now joins a long list of global tech giants entering the blockchain sector. This latest maneuver demonstrates the maturing of the Japanese security token market, as well as, a major milestone for Securitize.
Discussing the monumental achievement, Securitize CEO and co-founder Carlos Domingo spoke on what the investment means to the industry. He explained that Sony’s decision validates Securitize as one of the chief “architects of digital capital markets.” He also touched on Sony’s coveted brand and how the firm’s reputation is sure to bolster further interests in the security token sector.
Sony Financial Ventures (SFV)
Sony made its investment into Securitize via one of its main subsidiaries – SFV.GP. Notably, SFV.GP’s management responsibilities are split between Sony Financial Ventures (SFV) and Global Brain. Speaking On the news, SFV director Junji Nakamura explained the new capabilities blockchain tech brings to the table. He described the ability to create new asset classes and add liquidity to the market. Finally, he welcomed the challenges that his firm will encounter on their journey.
SFV is part of the Sony Financial Group. The Tokyo-based Sony Financial Group is a much larger financial services firm that includes numerous holdings on behalf of Sony. These holdings include Sony Life Insurance, Sony Assurance, Sony Bank, Sony Payment Services, and Sony Lifecare, just to name a few.
The Sony Financial Group has a reputation for investing in startups with the potential to disrupt markets. Currently, the firm has investments in Asia, North America, and Europe. These investments span the gambit of upending technologies including artificial intelligence (AI), the Internet of Things (IoT), and robotics.
The decision to invest in Securitize by Sony comes on the heels of a successful funding round for the firm. Securitize secured $14 million in investment funds from a wide variety of global investors. These investors included Nomura Holdings, MUFG Innovation Partners, Santander InnoVentures, and Blockchain Capital.
Securitize Making Moves
This year started off with a bang for Securitize. In January, the firm finalized a deal with AltoIRA. This deal was a major milestone for the entire security token sector because it was the first time that a platform received approval to allow US investors to invest in digital assets directly from their IRA. This momentum now continues with Sony jumping on board.
A Leader in the Blockchain Sector
Its been exciting to watch Securitize develop over the last few years. The firm has gone from a concept to a major player in the market. Today, Securitize is one of the most respected names in the game. Its no doubt that this stellar reputation is what caught Sony’s attention.
One thing is for sure, considering the level of interests Securitize garnished with this latest investor, its goal to modernize the capital markets is is in full swing.
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