Security tokens are going to write a new era for cryptographic tokens which will be thoroughly regulated. There are huge chances that a lot of institutional money will flow in. For making it easy for investors we need high frequency trading platforms that can comply with regulations and provide sufficient liquidity for security tokens side by side. Lets find out about the best security token exchanges inn market.
This article will cover the following exchanges: Gibraltar Blockchain Exchange, tZERO, OpenFinance Network, Templum and BnkToTheFuture.com.
So, Let’s have a look at the detailed analysis of these exchanges.
Gibraltar Blockchain Exchange
The firm made headlines back in October 2017 when GSX Group Limited, owner of the Gibraltar Stock Exchange, announced at the Hong Kong FinTech Summit for the creation of a new subsidiary, the Gibraltar Blockchain Exchange (GBX). The Exchange aims to be a world-leading institutional-grade token sale platform and digital asset exchange. Built upon principles of decentralization and community consensus. The exchange seeks to create a new era of trust, openness and global acceptance for the crypto industry with one quality token listing at a time.
The GBX intends to facilitate token sales similar to existing platforms but from a governed position. The GBX aims to put in place best practices, innovative sponsor staking regime and diligent whitelisting procedures coupled with a token marketplace that would consist of only of high-quality listings and an equally esteemed, AML/KYC cleared investor pool. The Rock Token (RKT) is the currency of choice for transactions, listings and a multitude of functions, serving as the medium of exchange and the utility coin that powers the GBX ecosystem.
GSX will officially seek regulatory approval from the Gibraltar Financial Services Commission (GFSC) to list and trade security tokens, kicking off the process in Q1 of next year. That a EU licensed exchange has recognized security tokens is a great step in the direction of security token awareness. The firm also has a huge backing from the industry and deserves that we keep an eye on its further developments.
tZERO, a subsidiary of Overstock (OSTK), is focusing on developing a Blockchain-based SEC compliant alternative trading system (ATS) specifically focused on tokenized securities. It wants to create ICOs that are SEC and FINRA regulations compliant. tZERO first announced itself to the masses with a press release on October 4, 2017. However, they have been active in the blockchain space since 2015.
tZERO owns two SEC registered and FINRA Member broker-dealers, SpeedRoute LLC, a premier routing and execution firm, and PRO Securities LLC, an Alternative Trading System (ATS), which is the first SEC and FINRA regulated ATS to enable and support secondary trading of a crypto security. The ICO of tZERO raised $134 million that began in December 2017 and ended in August 2018. The firm has also got $270 million in investment from a Chinese private equity firm GSR.
tZERO has also partnered with BOX Holdings where both companies are committed to form an exchange for companies to list and investors to publicly trade security tokens. tZERO infrastructure processes 15-18 million traditional orders per day and the platform is equipped to handle over 100 million users per day. tZERO trading platform has the potential to fundamentally disrupt existing Capital Markets, by allowing any public or private company to trade their own tokenized security.
OFN is building the first US based regulated security token trading platform, built for a tokenized future. Their system is designed for traditional alternative assets and token-based securities and allows for a streamlined compliant process from issuance to secondary market trading. The system allows direct integrations with financial institutions such as broker-dealers, custodians and transfer agents provide a bridge to the on-chain crypto capital markets.
The token OFN will act as a perpetual license to use the OFN technology system. The target users of the tokens are the 634,000+ brokers across 3,700 firms; 200,000+ investment advisors across 34,000 firms; 60M+ individual investors; and the developers who build products for this market. The OFN token will also pay a dividend to token holders (10% of adjusted gross revenue).
The firm has made some solid looking partnerships with Polymath, Republic, Vertalo, Harbor etc. The platform went live at the end of June after undergoing through rigorous beta testing from early investors and partners. Though all you can do right now is make an account and do the KYC, the trading isn’t live yet. The non-accredited investors can create an account on OFN, they won’t actually be able to trade anything until Reg A or Reg CF tokens are issued.
Templum, through its subsidiary Templum Markets LLC registered with SEC and FINRA is a platform for primary issuance and secondary trading of tokenized assets. It uses the word TAO (Tokenized Asset Offering) instead of using STO (Security Token Offering). Templum intends to facilitate the growth and expansion of tokenized securities by implementing standards and best practices for the offering of tokenized securities and their subsequent secondary trading.
Templum raised headlines in April after it raised $10 million from Japan’s SBI Group for financing the development of their trading platform and a planned expansion across Asia. They have acquired Liquid M Capital which gives them access to an ATS. With the ATS, the firm can offer liquidity for the securities they tokenize and also remain compliant with the US regulations side by side.
The platform is currently live but does not attract much in terms of listings. The firm recently gathered some news when crowdfunding giant Indiegogo announced that Token trading platform Templum Markets has launched a sale of a security token on behalf of a popular Colorado resort. Templum Markets LLC looks promising to an extent if we look at the recent developments. But the competition in this segment of market Is set to rise. How they develop further will be interesting to see.
BnkToTheFuture is a global online investment platform that allows qualifying investors to invest in financial innovation including FinTech (Financial Technology) companies, funds and other new alternative financial products.
With the launch of their native token-BFT, they gathered the largest community of high net worth individuals who are interested in investing in Fintech, Bitcoin & blockchain. The firm acts as a tokenized secondary market for investors who can invest in futuristic projects which issue security tokens, traditional bonds or other forms of digital securities. It can provide the much-needed liquidity to the new projects. The only limitation is that only accredited investors can invest, and it should be $1000- $10,000 of investment.
Their community is quite vibrant with active investors and entrepreneurs from 112 countries. If you are a qualifying investor that needs to diversify your portfolio. Also, you have an interest in gaining financial exposure to the growth of the future of finance, then bnktothefuture might just be the place for you.
So, this was all about the top security exchanges at the moment. Though this is not the end there are many others who are planning to enter the market like Coinbase and Bancor. The market will only rise in coming months and it will be worth watching for who will come out as the industry favorite.