Security Token Offering is a popular fundraising strategy that is adopted by most startups. As the former Initial Coin Offering strategy has lost its value in recent days, startups and investors were looking for a popular scheme that can overcome all these issues. This blog discusses the importance of security token offerings in the cryptocurrency world.
What is Security Token Offering?
A Security
Token Offering is a scheme where a startup/ company offers security tokens in
exchange for capital investment in their company. This can mutually be
beneficial for both ends.
With a
security token, the investor gains legal rights since only qualified tokens
under specific laws such as voting are taken into consideration. But in the
case of ICO, the tokens aren’t subjected to any such qualifications.
Hence most
of the STOs are now considered as ICOs with some regulations under SEC.
Security Token Offering involved Howey Test where the tokens have to satisfy
certain eligibility criteria.
Importance of Security Token Offerings:
For the year
2019, there was around 130% growth when compared to the previous year 2018. The
reason was the increased pressure from regulators to ensure compliance with
security norms.
When
comparing Security Token Offering with other fundraising mechanisms such as
IPO, ICO, there has been a huge set of benefits noticed.
How to launch an STO successfully?
- Pre Issuance Platform
- Token Issuance Phase
- Token Management
If you are looking to start STO at minimal cost, we people at Codezeros
are available to assist you! We have a good set of experience with developing
Security Tokens and bring in customizable STO Software for your
business!
Get
in touch with us instantly to launch your dream Security Token Offerings!
Talk to our Experts - https://bit.ly/3A6uXrM
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