3 ms·

Tokenized securities are private securities that comply with securities laws using Reg D, specifically Rule 506(c). In some cases they are Reg A+ (that come wit

by a_d 8y ago

Tokenized securities are private securities that comply with securities laws using Reg D, specifically Rule 506(c). In some cases they are Reg A+ (that come with JOBS act provisions used for crowdfunding). They are very important for the ecosystem for two reasons: 1) because ICOs are very important way of fundraising and they need to become compliant 2) they make illiquid assets like private real estate RIETs more liquid Since KYC/AML is enforced and investor accreditation is key to buying these securities, this will reduce scam and legitimize ICOs and security tokens overall. I can’t wait to see all the interesting possibilities with making illiquid assets more liquid using tokens to represent shares. This is an exciting development. Congrats to Coinbase.

a_d 8y ago
I can also imagine startup equity being tokenized. Where an exchange like Coinbase acts like SecondMarket (now called Nasdaq Private Market). This might be a great way for early employees and founders to get liquidity before the company IPOs. It would change the startup game completely. A lot of things to look forward to here.
- mrhappyunhappy 8y ago
  This already exists, I forgot the name of the company doing it.
- mihaifm 8y ago
  I difinitely hope it's going in this direction, but this space needs to mature a little bit, and perception needs to change. Currently ICOs are viewed as scams and some of them are still insanely overvalued.
  - startupfounder 8y ago
    The way to overcome this is to write milestones into the smart contract that unlock additional funding after the milestone is hit in a given time period. The issue with today's ICO is that the market demand is so high it would be silly for groups to leave money on the table. Just like bands leave money on the table because the value of their tickets > the price they sell them at. Many people on the buy side who get in early to ICOs are essentially scalpers whereas the people who run the project usually have no business raising the funds they do in their first round. Milestone funding would solve both of these issues.
- ForHackernews 8y ago
  Isn't this just an IPO under a different name? What's the difference between a "token" and a "share"? (Aside from the cryptocurrency hype-sauce)
  - repomies6999 8y ago
    Token is like a bearer share which can be transfered digitally from person to person. Bearer shares are not that common nowadays but I understand that in the past they were quite popular.
    - will_brown 8y ago
      They were popular, and it’s not that they are not that common nowadays...they are now illegal in all US states (and I believe every country too).
    - ghaff 8y ago
      I assume that bearer shares fell out of favor for a number of the same reasons as bearer bonds. On the one hand, the average person doesn't really want to hold a lot of money in paper assets that they're responsible for the physical security of. On the other hand, governments don't like untraceable paper assets that can be used to transfer a lot of value because of money laundering etc.
Torai 8y ago
Well, this is funny. I ask: Are Tokenized Securities like lending? Are there any sort of borrowing interests? Cause I haven't read the Bible (neither I'm religious), just googled it. But, isn't this like the beginning of a new economy? Are you a_d like the bad guys in the Bible fiction? Is 2000 years some universal cycle period time? https://www.gotquestions.org/Bible-lending-money.html https://www.gotquestions.org/Bible-lending-money.html A lot of people is going to lose a lot of money with this new betting game. Big Crypto holders will continue keeping their cryptos. Well, it's going to be funny as hell to watch it. But remember: - Angry people might eventually go after yourselves, violently, once they lose all their savings. Not me, I will be partying in Mallorca next week, with local friends. Spending money earned the classic way: WORKING.
- a_d 8y ago
  Tokenized securities are like a record of ownership, written and maintained on a ledger. They are like normal shares, governed by securities laws of the land. They could have dividends and could trade between two parties. Not sure what exactly you are asking?
  - Torai 8y ago
    I ask cause ignorance. So, thanks. But motivated by the fact that I always thought Bitcoin being so scarce, if mass adopted, some sort of Bitcoin lending scheme named as some new thing, would be created

by a_d 8y ago

a_d 8y ago

I can also imagine startup equity being tokenized. Where an exchange like Coinbase acts like SecondMarket (now called Nasdaq Private Market). This might be a great way for early employees and founders to get liquidity before the company IPOs. It would change the startup game completely. A lot of things to look forward to here.

mrhappyunhappy 8y ago
This already exists, I forgot the name of the company doing it.
mihaifm 8y ago
I difinitely hope it's going in this direction, but this space needs to mature a little bit, and perception needs to change. Currently ICOs are viewed as scams and some of them are still insanely overvalued.
- startupfounder 8y ago
  The way to overcome this is to write milestones into the smart contract that unlock additional funding after the milestone is hit in a given time period. The issue with today's ICO is that the market demand is so high it would be silly for groups to leave money on the table. Just like bands leave money on the table because the value of their tickets > the price they sell them at. Many people on the buy side who get in early to ICOs are essentially scalpers whereas the people who run the project usually have no business raising the funds they do in their first round. Milestone funding would solve both of these issues.
ForHackernews 8y ago
Isn't this just an IPO under a different name? What's the difference between a "token" and a "share"? (Aside from the cryptocurrency hype-sauce)
- repomies6999 8y ago
  Token is like a bearer share which can be transfered digitally from person to person. Bearer shares are not that common nowadays but I understand that in the past they were quite popular.
  - will_brown 8y ago
    They were popular, and it’s not that they are not that common nowadays...they are now illegal in all US states (and I believe every country too).
  - ghaff 8y ago
    I assume that bearer shares fell out of favor for a number of the same reasons as bearer bonds. On the one hand, the average person doesn't really want to hold a lot of money in paper assets that they're responsible for the physical security of. On the other hand, governments don't like untraceable paper assets that can be used to transfer a lot of value because of money laundering etc.

Torai 8y ago

Well, this is funny. I ask: Are Tokenized Securities like lending? Are there any sort of borrowing interests? Cause I haven't read the Bible (neither I'm religious), just googled it. But, isn't this like the beginning of a new economy? Are you a_d like the bad guys in the Bible fiction? Is 2000 years some universal cycle period time? https://www.gotquestions.org/Bible-lending-money.html https://www.gotquestions.org/Bible-lending-money.html A lot of people is going to lose a lot of money with this new betting game. Big Crypto holders will continue keeping their cryptos. Well, it's going to be funny as hell to watch it. But remember: - Angry people might eventually go after yourselves, violently, once they lose all their savings. Not me, I will be partying in Mallorca next week, with local friends. Spending money earned the classic way: WORKING.

a_d 8y ago
Tokenized securities are like a record of ownership, written and maintained on a ledger. They are like normal shares, governed by securities laws of the land. They could have dividends and could trade between two parties. Not sure what exactly you are asking?
- Torai 8y ago
  I ask cause ignorance. So, thanks. But motivated by the fact that I always thought Bitcoin being so scarce, if mass adopted, some sort of Bitcoin lending scheme named as some new thing, would be created