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As an emerging component of the cryptocurrency space, security tokens are becoming an appealing tool for companies an investors alike.
As an emerging component of the cryptocurrency space, security tokens are becoming an appealing tool for companies an investors alike.
Security tokens are, by definition, securities—tradable financial instruments representing a stake in wealth generated by a third party—that have been transformed into cryptocurrency tokens. This tokenization takes place within established infrastructure such as issuance platforms and exchanges, most of which are currently under development. Most security tokens are also under development, but there are a few already in existence.
In a recent article, the Invest in Blockchain publication featured five security tokens that have emerged on the scene. These include Blockchain Capital, a venture capital firm investing in blockchain technology companies, which was among the first to offer a security token. Its offering was conducted in a highly regulated manner and was only available to accredited investors, setting the stage for future offerings in the space. The token represents a portion of all profits earned by the fund, minus management and performance fees.
The list also includes 22X Fund, a tokenized fund that was developed by entrepreneurs looking to invest in startup companies; Slice, a commercial real estate platform providing international investors with access to US real estate; SPiCE VC, considered to be the first tokenized venture capital fund; and Siafund, a token generated on Sia’s decentralized cloud storage platform.
As these and other tokens continue to emerge, there is ongoing development taking place at the regulatory level, which is promising for companies in the space.
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Source: www.investinblockchain.com