This year’s StartEngine Summit held on October 19th at the Fairmont Hotel was very nicely attended with over a 1,000 people. Those in attendance featured groups from both traditional crypto and the ICO world as well as the emerging red-hot security token exchange universe.
This year’s hot topic was all about security tokens, which is considered the next big thing in the crypto space. The arrival of security tokens and the regulated exchanges where trades will be made was evident with the keynote speaker Chris Cox, former commissioner of the Securities and Exchange Commission, who discussed paving the way for these exchanges within the regulatory framework.
Another topic that’s trending as well are stable coins, which is a cryptocurrency designed to minimize the price volatility, were discussed as these are security tokens that should be traded only on regulated security token exchanges since they collateralize assets, including US Dollars or other currencies. In simple terms, stable coins seek to be the ideal bridge connecting the blockchain to tangible assets.
In talking to those in attendance, everyone felt that there were still more regulatory frameworks has a long way to go before security tokens can go mainstream, which further highlighted the complexities that are associated with regulated security token exchanges, including their need to have a regulated custodian that is also SEC approved to custody security tokens.
A few institutional investors that we chatted with, indicated that further discussions around the benefits of a tokenized economy require a bit more market maturity and more discussions are required, where security token exchanges like brX Exchange will play a vital role in the transformation of global assets on the blockchain.
Overall, the attendee sentiment was that security token exchanges are quite challenging in how they are structured, and they need to be dealt with in a compliant manner as the risk of running afoul with the securities and exchange commission or any other regulatory body are extremely high and can really slow the progress of the company for non-compliance, in addition to the reputational risk the project will endure.
It is still pretty early in the security token exchange world and the most appropriate blockchain still has to emerge that would be the defacto standard. However, there are several blockchains that are battling to be the leading contender, including Stellar, EOS, ADA, etc.
This leads to other topics, which assets are the most suitable for tokenization and how can investors can put capital in them. From real estate to private assets, several global asset classes are the prime target and we heard from the conference that investors are getting involved at record pace especially since the traditional ICO market has for the most part disappeared.
StartEngine’s Tokenizing The World was a great catalyst for conference month events in LA such as Crypto Invest Summit that took place on Oct 22 – 24, 2018. It was great to see familiar faces and new ones as well. For all crypto aficionados that have come to evolve with space, it was also a breath of fresh air to see market maturity in the space with professional money coming into space.
Contributed by Eli Ansari, Co-founder & CEO, brX Exchange
Eli is the Head of Blockchain Investment Banking and Managing Director at Boustead Securities (FINRA member and SEC Registered Broker-Dealer)advising Blockchain companies on strategizing and executing Security Token Offerings. Eliis also a Managing Partner at Boustead Capital Partners, an institutional digital asset management firm focus on investments in blockchain tech, digital currency, tokens, and crypto assets.