Leading Digital Asset Investment firm in the New York, NovabLock Capital in partnership with Ownera and Security Token Summit has released an in-depth report that outlines the present, past and future of digital securities. The report which is titled “State of Smart Securities - 2019” highlighted the evolution of capital formation, the benefits of smart security and the challenges ahead.
Also known as Security Tokens, Smart Security relies on blockchain technology to expand investor base and reduce frictions to trade, while automating compliance procedures, such as investor eligibility, disclosures and communications, cap table management, and enforcement of investor rights. It also enables fractionalized ownership of real assets, instant settlement, 24/7 global markets, increased liquidity, and reduction in ongoing compliance and issuance costs.
According to the CEO of NovaBlock Capital, Leeor Shimron Smart Securities are the next evolution of capital markets and capital formation.
“This phenomenon will affect retail and institutional investors, enabling the creation of new modes of ownership and eliminating the barriers to participation amongst a global investor base. No asset class is immune, and this technology will force the largest of financial institutions to pay attention to the promises of the blockchain. Trillions of dollars of wealth creation are at stake as digital assets gain the monetary premia currently enjoyed by US equities, real estate, and other traditional assets.” He added.
The report also indicated that the introduction of Smart Security as an investment vehicle will create an arm race to tokenize previously illiquid asset classes.
“These developments provide an unprecedented set of choices for accredited and institutional investors to gain portfolio diversification, long-term asset appreciation, and additional sources of revenue across an asset’s lifecycle.” Some of the benefits of Smart Security as stated by the report include; “fractional ownership, 24/7 global markets, automated compliance, rapid settlement, and increased liquidity cost reduction.”
Already some issuance platform technology and service providers which have tokenized their LP interests to add secondary-market liquidity have indicated interest in this security Token.
“Polymath is developing a suite of tools for participants to launch, invest and trade in financial products on the blockchain. The Polymath platform will facilitate interactions between issuers, service providers (specifically KYC providers and legal firms), investors and developers. Harbor is an all in one platform for tokenizing private investments. Harbor provides a fully compliant solution with KYC/AML integrated into the blockchain protocol. The primary focus is on real estate with initial investment offerings including housing complexes across the US.
“Trust Token aims to build a legally enforceable protocol with blockchain-based ownership and control of real-world assets via smart contracts. The company created TrueUSD, the current largest USD backed stablecoin by market capitalization, and plans to tokenize assets including fiat currencies, commodities, and real estate.”
On the future of Smart Security, the report states that digital securities may trade at a discount to NAV. However, regulatory Compliance KYC/AML/OFAC and sanctions screening mechanisms must be automated, while Legal frameworks need to be established to reduce legal barriers to entry.
To find out more about NovaBlock Capital, Ownera and the 2019 Security Token Summit scheduled for April 8th, at The Ritz-Carlton Los Angeles. Click here
The High-End, Digital Asset and Securities Focused Event is Bringing Together the Top Investors, Entrepreneurs and Leaders in this Exciting New Industry
LOS ANGELES, CA / January 3, 2019 / Goren Holm Group, producers of Crypto Invest Summit, the world’s largest investment focused blockchain event today announced the formation of their new company, Security Token Summit, LLC, and their first event, to be held on April 8th, 2019 at the Ritz Carlton in Downtown Los Angeles. Early bird discounted tickets are available for $499 for a limited time via the summit's website.
Security Token Summit is a high-end, Security Token & Digital Securities focused event. It will feature a robust agenda spanning a variety of themes such as custody, compliance, regulation, investing, marketing, tokenization, standards, issuance and real estate. The full-day summit will feature panels, fireside chats and presentations including the top names in the digital securities space. Already slated to speak are Ami Ben David, Tal Elyashiv, Carlos Domingo, Jamie Finn, Jor Law, David Weild, Amy Wan and Andrew Dix.
Founded and produced by equity crowdfunding industry pioneers and online investment marketing experts who are among the most followed and influential individuals in Fintech, Josef Holm and Alon Goren, Security Token Summit was developed with the vision that the rules and regulations created to make online investing more accessible (Regulation Crowdfunding, Regulation A+ and public solicitation), when combined with blockchain and distributed ledger technology can now be used to create a new breed of digital assets and finally bring to fruition the true democratization of capital.
Security Token Summit, LLC is also advised by several industry pioneers, including:
David Weild IV, who is a stock market expert best known for his position as Vice Chairman of NASDAQ. He is currently the Founder, Chairman, and CEO of Weild & Co. Inc. which is revolutionizing investment banking. Weild is also known as the "father" of the JOBS Act and has been involved in drafting legislation for the US Congress.
Jor Law, who co-founded the compliance software company, VerifyInvestor.com. Jor serves on the board of Prime Trust and is also a consultant for prominent companies in the STO ecosystem globally, including tZERO and Polymath.
Ami Ben David, whose fund, SPiCE VC, is the first fully-tokenized and distributed venture capital fund. SPiCE VC recently made history by being the first digital security traded on the blockchain.
For tickets to Security Token Summit, sponsorship opportunities and to learn more, visit SecurityTokenSummit.com
About Goren Holm Group
Goren Holm Group, led by Josef Holm and Alon Goren are industry pioneers, investors and producers of some of the top blockchain and cryptocurrency conferences in the world. Their backgrounds in venture capital, crowdfunding and online investment marketing technology make them uniquely equipped to service the digital securities revolution. Alon and Josef have also assembled an advisory board of some of the top industry experts to advise, influence and co-organize Security Token Summit.
Charlie Lee and the Litecoin Foundation to join Crypto Invest Summit’s Highly Successful, Hyper-Focused Builders’ Track To Increase Blockchain Development and Adoption
LOS ANGELES, CA, December 12, 2018 - Crypto Invest Summit, the United States’ largest cryptocurrency and blockchain conference has partnered with the Litecoin Foundation, led by Litecoin creator Charlie Lee, to program the portion of the Builders’ Track devoted to Bitcoin, Litecoin and Lightning Network development at this spring’s Crypto Invest Summit. Each Track at Crypto Invest Summit is designed to specialize in various highly sought-after topics with the goal of increasing blockchain usability, development, and collaboration.
Other breakout sessions include the Women in Crypto Track, Security Token & Digital Asset Track, Crypto Trading Track and Healthcare Track. Attendees automatically get all-access passes with every Crypto Invest Summit ticket purchase; seating is limited on a first-come-first-serve basis.
Aside from the the Builders’ Track, Charlie will be featured in a keynote fireside chat on Crypto Invest Summit’s main-stage and the Litecoin Foundation will have booth on the Crypto Invest Summit expo floor.
"I’m really looking forward to Crypto Invest Summit. Education is key," said Charlie Lee, creator of Litecoin and the Managing Director at Litecoin Foundation. "We are excited to be partnering with Crypto Invest Summit to plan multiple sessions devoted to educating developers about building on the Bitcoin, Litecoin and Lightning networks."
In a joint statement, Alon Goren and Josef Holm, founders of Crypto Invest Summit and early-stage investment fund GHV said, “Each track is devoted to helping us fulfill our mission of bringing blockchain technologies to the masses. As a long-time builder and advocate for the space, Charlie Lee, and the Litecoin Foundation that he created, are perfect partners to help us create educational content for our thousands of attendees.”
About Crypto Invest Summit: After two sold-out events in 2018, CIS comes back to the Los Angeles Convention Center on April 8-10, 2019. The summit brings together developers, entrepreneurs, startups, angel investors, venture capital investors, retail investors, family offices, real estate investors, startups / entrepreneurs, issuers, exchanges, broker-dealers, service providers, and members of the media. Previous headliners include: Steve Wozniak, Tim Draper, Dan Morehead, Crystal Rose, Mance Harmon, Ran Neu-Ner, Marcus Lemonis, Robert Herjavec, Ami Ben David, Bill Barhydt, Scott Walker, Adam Draper, and Apolo Ohno. More information and press passes at https://cryptoinvestsummit.io
Crypto Invest Summit Introduces New Hyper-Focused Tracks in Partnership with ConsenSys and Token Foundry To Increase Technology Development and Adoption
LOS ANGELES, CA, September 26, 2018 - Crypto Invest Summit, the West Coast's largest cryptocurrency and blockchain conference, has partnered with Token Foundry and ConsenSys to introduce their first ever Builders’ Track, the latest addition to their pre-existing line up of content-heavy breakout sessions. Each Track is designed to specialize in various highly sought-after topics with the goal of increasing usability, development, and collaboration.
Other breakout sessions include a Women in Crypto Track, Security Token Track, Crypto Trading Track and Healthcare Track. Attendees automatically get all-access passes with every Crypto Invest Summit or LA Blockchain Week ticket purchase; seating is limited on a first-come-first-serve basis.
In a joint statement, Alon Goren and Josef Holm, founders of Crypto Invest Summit and early-stage investment fund GHV said, “Each track is a focal point in helping us fulfill our mission of bringing sustainable investing in blockchain technologies to the masses. We brought on ConsenSys, Token Foundry, and numerous other prominent leaders to ensure our attendees maximize their time, value, and money while receiving the latest and most credible information in the marketplace.”
Token Foundry will join ConsenSys in leading the Builders’ Track with headlining topics discussing Token Economics, Token Market + Marketing Growth, The Brooklyn Project and Regulations, Security Tokens, Game Theory, and Crypto Adoption and Bootstrapping Network Effects. The track will feature many key players within ConsenSys, Token Foundry and their network of companies.
“We are looking forward to introducing the thousands of attendees at Crypto Invest Summit to some of our top companies and best practices,” said Amanda Gutterman, CMO of ConsenSys. “This is an exciting partnership for us and are excited to help program these tracks to be extremely productive and informative.”
ConsenSys, founded by Joseph Lubin, is a global formation of technologists and entrepreneurs building the infrastructure, applications, and practices that enable a decentralized world. They specialize in building core components, decentralized applications (DApps), enterprise solutions and various developer tools for blockchain ecosystems, focused primarily on Ethereum.
Token Foundry provides comprehensive infrastructure and advisory services to help best position new token economies for long term success. “We’re super excited to collaborate with Crypto Invest Summit and ConsenSys to curate this hyper-focused Track. Showing attendees how to develop long term success in decentralized networks has been our mission since day one, so deciding to collaborate on this track together was a no brainer,” said Mahoney Turnbull, Head of Community at Token Foundry.
About Crypto Invest Summit: Sold-out in 2017, CIS, comes back to the Los Angeles Convention Center on October 22nd. The summit brings together angel investors, venture capital investors, retail investors, family offices, real estate investors, startups / entrepreneurs, issuers, exchanges, broker-dealers, service providers, and members of the media. Previous headliners include: Tim Draper, Crystal Rose, Mance Harmon, Ran Neu-Ner, Marcus Lemonis, Robert Herjavec, David Siemer, Bill Barhydt, Scott Walker, Adam Draper, and Apolo Ohno. More information and press passes at https://cryptoinvestsummit.io
There is a lot of talk about securities tokens, but they don’t apply for networks and applications. If you register a token as a security then you can’t use it in your application or you will then be trading securities every time someone wants to participate in your game or dating app, or whatever you’ve built.
A security token can’t be used for the intended purpose of 99% of the applications being built by ICOs. What this means is that there is no ‘out’ for companies to build applications that use tokens or coins internally and pre-sell them ahead of time. In much the same way you would pre-sell concert tickets or video games, companies pre-sell tokens to get people excited and start the marketing process as soon as possible.
A security token is useless for applications because of the rules involved in trading them. If most blockchain projects have token economics that require free trade of their in-game currency and reward system then most blockchain projects cannot use security tokens. Do you want to register your dating application as a securities trading platform to use your rewards token? Should only accredited investors be allowed to play your new game? This means there is no path forward for companies in the United States to sell tokens before their applications are built. This means for the majority of potential ICO projects that can be built there is no pre-sale allowed. If a company cannot pre-sale then it’s competitors who can in other countries will have an edge over the U.S..
At this point there is no path forward in the United States for ICOs for blockchain projects. They have essentially been killed. Registering a token as a security kills it’s use as a token in an application. It seems we may be able to have those tokens in applications, but we can’t pre-sell them. Their right to exist certainly isn’t guaranteed outside Wyoming. This means countries outside the U.S. have an advantage and there doesn’t seem to be a reason for a company to create a blockchain company in the United States because of the severe limitation.
Unless the SEC exempts tokens from securities when they are used as utilities even in pre-sale then the United States has missed the blockchain train. It’s like the dot com revolution has started and the United States has decided to sit this paradigm shift out.
A security token or a token that represents some kind of equity is a much less inspired concept. It is not going to create new industries like utility tokens. It represents a marginal shift and questionable improvement over ordinary digital stock certificates or bonds. Since you need to have all the owners registered in central databases the friction in trading them is almost the same as trading traditional stocks. These central databases will all need to have authority in a traditional yet still unknown way. After all of that is built there will be little new industry.
The real advantage of cryptocurrency and tokens are in utility and rewards. Many large companies in the United States, like Starbucks, Walmart, and CVS already use points and rewards systems. Utility tokens allow for more complex incentive software. This is where the real value of tokens comes into it’s own. Most companies building this software are now building this software outside the United States because they are unsure if the United States allows for utility tokens. We certainly have set a precedent that we don’t allow for pre-selling utility tokens. Starbucks reward points are utility tokens. Concert tickets are utility tokens. Vouchers for pre-sold video games are utility tokens.
The United States should allow for the pre-sale of utility tokens and explicitly exempt them from securities laws like Wyoming has done. Without this advantage we fall further and further behind in the blockchain revolution.
ICOs were invented for utility tokens. The largest ICOs around the world are still occurring to create some of the most powerful projects in the world and none of them are in the U.S. This is because there is no legal way forward to pre-sell a utility token and this was the reason for ICOs to exist. At first thought securities tokens seem like an answer. There are now securities tokens, but the limitations for using them will become more clear as time goes on. This is why blockchain companies did not adopt them. Only a small group of companies with stock-type tokens representing equity and commodities will exist in the United States. This limits the United States to a much smaller range of possibly new companies. What’s worse is that these will be the least innovative kinds of companies using traditional asset backed representation for their tokens and not the vast myriad of possibilities represented by utilities tokens.
The blockchain revolution has started and the United States has opted out. Companies trying to pre-sell utility tokens are not attempting to break securities laws or scam customers. They are using the new technology to create innovative new technologies before the rest of the world. They are creating new businesses in mass. Companies creating securities tokens are pushing old businesses onto new databases. We need the utility tokens to keep competitive edge in the United States, but we are on the wrong path. We have not allowed for a way forward for them. The lawyers need to take their teeth out of utility token technology if we are to see them grow. If people want to have securities tokens then why not have both? One does not preclude the other. By only allowing one very limited use of tokens and cryptocurrency in the United States there is no path forward for blockchain innovation.
Who did this? Did the investors ask for it? Lawyers always speak of protecting investors, but there was no petition to stop the sale of utility tokens. Who asked to kill the ICO? My bet is on the securities lawyers. When you are a hammer everything is a nail. But what is the expense of giving securities lawyers more paid work? Is the next google already going to be located outside the U.S.? Did we lose the Microsoft of blockchain already? Give us rules to continue to create business and innovate. Give us a path forward. How can we have utility tokens? How can we use this technology? Who killed the ICO?
Author - Nicholas Juntilla of ReceiptChain.io
Our friends at Wiki define a token economy as behavioral modification through systematic reinforcement, which loosely means you do the right thing - you get a ‘token’ prize. A token is simply an asset that can be exchanged for something else of value - material or immaterial.
In the Blockchain & Cryptocurrency industry, we refer to tokens as digital assets within an ecosystem. Tokens are used in relation to blockchain applications & platforms, and can be programmed for specific use-cases to attain desired goals. Smart contracts govern how tokens are deployed; hence the term, ‘Programmable Money’ was born.
Economic systems based on blockchain technology are researched, designed, and implemented - and the applications inherently follow unique economic models utilizing cryptocurrencies…this, in a nutshell, is what we call “Token Economics”.