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The Security Token Market in 2019

The Security Token Market in 2019

Feb 19

In 2018, it became painfully apparent after a study was released claiming 80% of ICOs conducted in 2017 were scams, that ICOs needed some kind of regulation or solution to protect those investing in them. Thus STOs were born.

STO, or Security Token Offering is the regulated alternative to the ICO. Basically, a company can raise funds through token sales by having the financial security that backs the token. This way there is some degree of regulatory protection to protect investors from investing in low-quality or fraudulent projects.

Security tokens became the talk of the town in 2018 after a slew of ICO scams left crypto enthusiasts in doubt as to the future of the market. According to inwara, security token offerings are picking up where ICOs started tapering off. Meaning that the thought is STOs will eventually replace ICOs. October 2018 saw the highest number of STOs being registered according to inwara data.

According to Money Morning, security token offerings could reach $10 trillion by 2020, which may seem like too grand of a number to be believable, but it could be a possibility sometime in the future (but probably not in such a short amount of time). While it may be too soon to start predicting what heights STOs will reach, nobody can deny that the security token revolution has arrived and is ready to take over the market.

STOs need to be bought and exchanged on security token exchanges, of which there are only several at the time being. Here is a list of some of them:

There are also specific regions that are currently capable of STO regulation and those are:

The United States (Regulation D, Regulation A+, or Regulation S) The European Union (EU’s pan-European securities laws) Switzerland Singapore (local securities laws) Hong Kong

It can be posited that the possibility of regulation combined with investment transparency could result in rapid market growth...

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