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tZERO to Add Trading of ASPEN Digital Securities Token in Q3, 2020

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tZERO to Add Trading of ASPEN Digital Securities Token in Q3, 2020

tZERO, a digital securities exchange which is a subsidiary of Medici Ventures, has announced today that it has entered into a partnership with Aspen Digital Inc. to enable its digital security (ASPEN) to be traded on the tZERO ATS.

Currently only two tokens are available to be traded on the tZERO platform they include TZROP the token for tZERO and OSTKO the token representing Overstock. This new addition is long overdue as it is the first token to be added to the trading platform that is not directly associated with either tZERO or Overstock (NASDAQ:OSTK).

The ASPEN tokens represent $18 million of indirect ownership in the St. Regis Aspen Resort, a five-star, 179-room luxury hotel located in Aspen, Colorado.

tZERO CEO Saum Noursalehi stated, “We are excited to join forces with Aspen Digital to enable the St. Regis Aspen digital security to trade. We look forward to beginning the onboarding process and anticipate that trading will commence on the tZERO ATS this quarter.”

The issuer of ASPEN, Aspen Digital, Inc., is managed by ER-RE, LLC., a subsidiary of New York-based real estate asset management and advisory firm Elevated Returns, LLC. Valued at $224 million during the time of the offering in October 2018, the St. Regis Aspen Resort is the first digital security within Elevated Returns’ portfolio. Elevated Returns intends to tokenize roughly $1 billion of real estate projects in the future.

Elevated Returns President Stephane De Baets said, “Investing in commercial real estate projects is often prohibitive for most investors, particularly for high-profile properties. We believe investors will benefit from the transparency, accessibility and liquidity of the ASPEN digital security through our partnership with tZERO, who we view as the leader in capital markets innovation and secondary liquidity for private assets.”

Shares of ASPEN were distributed to accredited investors through a Reg D 506 (c) offering, which closed in October 2018 and raised $18 million. Aggregate shares of ASPEN represent an 19% indirect ownership interest in the St. Regis Aspen Resort, and the remaining 81% is indirectly owned by Elevated Returns.

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Antoine Tardif is the founding partner of Securities.io, the CEO of BlockVentures.com, and has invested in over 50 blockchain & AI projects. He is also the founder of Unite.AI a news website for AI and Robotics, as well as Bitcoinlightning.com a news website focusing on the lightning network.

Regulation

Traditional Banks Ramp Up Custodial Services for Digital Assets

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In recent weeks, we have seen an increase in the adoption of blockchain services, among traditional banks.  First, U.S. based banks were given the green light to custody cryptocurrencies by the Office of the Comptroller of the Currency (OCC).  Now, we learn that one of the largest banks in South Korea, KB Kookmin Bank, is already working to develop similar services.

Who’s Involved?

With regard to South Korea, the plan is for KB Kookmin Bank to begin offering custodial services for digital assets.  This is a group effort involving the following companies,

This collaboration is particularly noteworthy, as KB Kookmin Bank is not just any old bank.  They are currently the largest bank in South Korea.  Moves made by a bank of this stature are followed closely by many.  Although KB Kookmin Bank and its partners may be first to the table, expect to see others take a seat in the near future.

Future Asset Expansion

While initial services will centre on the custody of cryptocurrencies, it is believed that this support will eventually grow, encompassing various types of digital assets.  More specifically, it is expected that in time, these custodial services will support digital securities.

In commentary released by Hashed, this expansion of supported assets was touched upon.  Hashed states that through this collaboration, participants anticipate, “…that the digital asset industry will not only involve cryptocurrencies, but also other traditional assets such as real estate, artwork, and other reified rights that will be issued and traded on blockchain platforms.”

Although cryptocurrencies stand to benefit first, the development of such custodial services has the potential to transform and usher forth new growth among the digital securities sector.

Office of the Comptroller of the Currency

In the weeks preceding the news surrounding KB Kookmin Bank and its forthcoming custodial service, we saw the OCC release of an interpretive letter on the subject.

In this letter, the OCC breaks down, not only what digital assets are, but how banks can support the growing use.  The OCC summarized its stance, stating,

“The OCC recognizes that, as the financial markets become increasingly technological, there will likely be increasing need for banks and other service providers to leverage new technology and innovative ways to provide traditional services on behalf of customers. By providing such services, banks can continue to fulfill the financial intermediation function they have historically played in providing payment, loan and deposit services.”

It continued,

“…we conclude a national bank may provide these cryptocurrency custody services on behalf of customers, including by holding the unique cryptographic keys associated with cryptocurrency.  This letter also reaffirms the OCC’s position that national banks may provide permissible banking services to any lawful business they choose, including cryptocurrency businesses, so long as they effectively manage the risks and comply with applicable law.”

Bank Adoption

Which came first, the chicken? Or the egg?  This old saying could easily be applied to the current world of blockchain.  Are these traditional banks jumping on board the train due to the recent resurgence being seen in the sector?  Or is the sector surging due to banks jumping on board.  Regardless of the answer, signs of blockchain adoption within traditional industries is a definite positive.

Hopefully, this swing in sentiment among banks continues to gain momentum, as banks have not always viewed digital assets in a positive light.  Only months ago, we were reporting on difficulties being faced by German companies, as they were refused services by traditional banks.

KB Kookmin Bank

Founded in 2000, KB Kookmin Bank maintains operations in Seoul, South Korea.  Since launch, KB Kookmin Bank has grown to employ over 25,000, while providing customers on a global scale with access to commercial banking services.

CEO, Hur Yin, currently oversees company operations.

Office of the Comptroller of the Currency (OCC)

The OCC is a U.S. based regulatory body, tasked with supervising national banks.  This supervision is undertaken with the goal of ensuring fair and transparent financial services to all customers.

Acting Comptroller, Brian P. Brooks, currently oversees operations at the OCC.

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Digital Securities

META 1 Coin Threatens Securities.io with Litigation for Reporting on ICO Fraud

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META 1 Coin Threatens Securities.io with Litigation for Reporting on ICO Fraud

On August 4th, 2020 Securities.io was threatened with legal action by Robert Paul Dunlap, the legal advocate for META 1 Coin, the creator, owner, controller, and also one of the defendants in the Complaint filed by the SEC. The threat followed the publication of an article titled “SEC Files Charges Against ex-Senator David Schmidt” which was published on March 25, 2020.

Who is META 1 Coin?

META 1 Coin raised funds in April 2018 by performing an Initial Coin Offering (ICO).  As described by an SEC filing META 1 COIN raised at least 4.48 million from over 150 investors in the United States and internationally.

In order to raise funds misleading claims were made. These were some of the claims:

  • They owned $1 billion in art insured against loss by a surety bond, and later, that META 1 owned $2 billion in gold assets;
  • KPMG, one of the largest independent financial audit firms in the world, was auditing Meta1’s gold assets;
  • Meta1 formed its own investment bank and developed its own digital currency exchange;
  • the Coin is safe and risk-free and will never lose value;
  • Each Coin, sold for either $22.22 or $44.44 would in two years be worth $50,000—up to a 224,923% return—as a “very conservative value.”

Unfortunately many investors did not perform adequate due diligence as the SEC claims the tokens were backed by nothing.

Litigation Threat:

The letter received by META 1 accused the SEC and Securities.io of being fraudulent, below are some of the accusations/threats and our responses.

If SECURITIES.io was to do any due diligence at all you would know it was a fictitious story fabricated by the SEC in order to make all digital assets look fraudulent.

Our response: Securities.io has the responsibility of reporting on both legitimate projects, and fraudulent projects. Every time an investor is taken advantage with false claims whether it is the form of an ICO, or other fraudulent behavior, it destroys the credibility of the industry. We also believe in the credibility and the mission of the SEC which is stated as “The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation”.

So time will tell if SECURITIES.io is really about digital assets or just another STATE run publisher of malicious defamation.

Our response: Perhaps this is pushing a conspiracy theory or an agenda of being owned and controlled by a deep state. Either way, Securities.io is NOT owned in part or in whole by any government entity in any jurisdiction.

Today is August 4th 3:25 EST 2020 and a claim will be made in 24 hours and It will decimate SECURITIES.io if the named article is not immediately removed.

Our Response: This has been noted. We have fact checked the original article and it remains accurate.

Additionally, I am ordering a follow-up update of the facts regarding the validity or META 1 Coin

Our Response: We have updated the article to reflect new information regarding the fraud behind the initial ICO raise. We were unaware that information was missing, thank you for notifying us of this. Whenever we are notified of errors in reporting we take corrective action.

Summary:

Unfortunately, the digital assets industry continues to result in many operators that are taking advantage of the naivety of investors. It is our responsibility to report on this unethical behavior and to report on any actions taken against these rogue operators by the SEC or other government entities. We will continue with our mission.

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Digital Securities

Polymath Launches ‘Token Studio 2.0’ on ‘Polymesh’ Digital Securities Blockchain

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Token issuer Polymath has had a busy few weeks.  Just over one month ago, the digital securities pioneer announced the launch of Aldebaran – the first iteration and testnet of the Polymesh  blockchain.  Now Polymath has announced version 2.0 of its ‘Token Studio’, a suite of token services, which now runs on the Polymesh blockchain.

Token Studio

When Polymath uses the term ‘Token Studio’, it is referring to a suite of services, which allows clients to create, issue, and manage digital securities – a vital part of Polymath’s goal to simplify token creation.

The first iteration of Polymath’s Token Studio was based on the Ethereum blockchain.  With the development and pivot towards the use of Polymesh, a new Token Studio was needed – one that was designed for this purpose-built blockchain.

With the launch of this version of Token Studio, Polymath has now opened up the ability for clients to trial its capabilities on the recently released Polymesh testnet ‘Aldebaran’.

Polymath notes that by utilizing Token Studio on the Polymesh blockchain, clients will benefit in various ways.

Design
  • Clients have the ability to create digital securities tailored to their needs – this includes asset type, ticker symbols, asset identifiers, etc.
Identity
  • Built-in services including KYC checks.  This ensures that only appropriate investors can gain access to digital securities created through the use of Polymesh.
Compliance
  • Arguably, the biggest draw towards a purpose-built blockchain is the ability to integrate stringent compliance measures – a necessity when dealing with digital securities. This means that, regardless of jurisdiction, token issues can be assured that their issuances remain in full compliance with securities regulations.

With Token Studio simplifying the creation and issuance process, there should be nothing holding back companies from creating compliant digital securities on the Polymesh blockchain.  The timing of the Polymesh-based Token Studio is ideal; anticipated security token exchange Archax previously announced support for Polymesh tokens when it launches.

Aldebaran

In the constellation, Taurus, the brightest star is Aldebaran – commonly referred to as the ‘bulls-eye’.  This is an apt name for a company that utilizes a bull as its mascot and represents a bright spot within the digital securities sector.

Aldebaran represents the first testnet of the purpose-built Polymesh blockchain.  Polymath has spoken on the rationality behind creating a project such as this, stating,

“The most important learning has been that security tokens cannot gain adoption and acceptance from regulators and institutions with a general-purpose blockchain; security tokens need something more specialized that addresses the foremost concerns of governance, confidentiality, identity, and compliance.”

For holders of Polymath’s ‘POLY’ tokens, a bridging service has been created to convert these assets to ‘POLYX’ – A token with similar functionality, but based on the Polymesh blockchain, rather than Ethereum.  Along with this bridging service, Polymath will soon be launching a Polymesh wallet – providing a way to safely store these assets, while supporting staking capabilities.

The next version of the Polymesh testnet is expected to launch in Q4 of 2020, with the full mainnet launch in Q1 of 2021.

Polymath

Founded in 2017, Polymath is a service provider for the digital securities sector, with operations based in Toronto, Canada.  To date, Polymath has helped facilitate the creation of hundreds of digital securities.

 

In Other News

Polymath is not the only company to note the need for purpose-built digital security solutions.  We have recently taken a closer look at another example of this, as NEM gears up for the launch of its offering, ‘Symbol’.

Make sure to peruse our recent interview with NEM Ventures Managing Director, Dave Hodgson.  Here, we learn more about Symbol, and why such a solution is needed.

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Trading Risk Disclaimer: There is a very high degree of risk involved in trading securities. Trading in any type of financial product including forex, CFDs, stocks, and cryptocurrencies involves a high level of risk.

This risk is  higher with Cryptocurrencies due to markets being decentralized and non-regulated. You should be aware that you may lose a significant portion of your portfolio.

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