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Boston Security Token Exchange, a platform jointly owned by BOX Digital Markets and tZERO, seeks the U.S. SEC’s approval to launch a market for security tokens. Boston Security Token Exchange (BSTX), a platform jointly owned by BOX Digital Markets and Overstock’s blockchain arm tZERO, has filed an application with the United States Securities and Exchange Commission (SEC) to approve the launch of a market for publicly traded registered security tokens. In the rule change proposal released by the SEC on Oct. 11, BOX asks the commission to “adopt rules to govern the trading of equity securities on the Exchange” which “would operate a fully automated, price/time priority execution system for the trading of ‘security tokens.’” Establishing its own listing standardsThe firm also hints at having its own listing standards by specifying that only tokens meeting them would be listed on the platform. The 129 pages long document explains in detail how the rules under which the exchange operates ..
The Japan Security Token Offering Association comes at a time when the industry is looking for clarity, self-regulating is the next step. Security token offerings, or STOs, have more or less taken the mantle from their semi-defunct counterpart, the initial coin offering (ICO). Still, the extreme rise and subsequent fall of the ICO has left quite an impression on the cryptocurrency industry. At its peak prevalence in 2017, this novel fundraising prototype accumulated a total of $6.2 billion — but it wasn’t set to last. Come December of the same year, ICOs had become a shadow of their former selves, plummeting in demand. So far, a mere $366 million has been raised via ICOs in 2019, a retrace of 94% from their high some two years prior. This is perhaps a direct effect of the laissez-faire nature of ICOs. In 2018, the United States Securities and Exchange Commission (SEC) seemed to have decided that enough was enough, filing multiple injunctions against what it deemed to be “unregistered..
Ex-federal prosecutor and now Andreessen Horowitz partner Katie Haun argues that the United States blocking Facebook’s Libra will have national security implications. Ex-federal prosecutor and now Andreessen Horowitz partner Katie Haun has argued that the United States blocking Facebook’s Libra digital currency will have national security implications. Haun’s comments were reported in a CNBC profile published on Oct. 6. “Frankly a dangerous precedent” to shut Libra downAndreessen Horowitz is a founding member of the Libra Association, the Switzerland-headquartered non-profit consortium established to govern the Libra token. Speaking of the planned cryptocurrency, Haun noted that the social media titan’s project was facing “the same criticisms” and misperceptions that the asset class faces more broadly. She noted: “They were just heightened and they got more attention because of the high-profile nature of the project and the fact that Facebook was involved. I think it would be a reall..
Bitcoin is not a security, says the United States Securities and Exchange Commission in a letter to Cipher Technologies Bitcoin Fund. The United States Securities and Exchange Commission (SEC) has yet again officially stated that Bitcoin (BTC) is not a security. In a letter to Cipher Technologies Bitcoin Fund dated Oct. 1 the SEC declined the investment company’s registration statement on the grounds (among others) that Bitcoin is not a security. Per the letter, Cipher attempted to register an “investment company” under the Investment Company Act of 1940, implying that Bitcoin is a security. Not a securityThe SEC staff, on the other hand, has argued Cipher’s reasoning under the Howey test and its framework for analyzing digital assets published in April. The letter states: “Among other things, we do not believe that current purchasers of Bitcoin are relying on the essential managerial and entrepreneurial efforts of others to produce a profit. Accordingly, because Cipher intends to in..
Leading Japanese financial firms like Monex Group and SBI Securities are forming a regulatory body for security token offerings. Leading Japanese companies are forming a regulatory association for security token offerings (STO). On Sept. 30, the Nikkei Asian Review reported that firms such as SBI Securities, Nomura Securities, Monex Group and Daiwa Securities Group are part of the STO association that will propose a new set of rules and seek approval from the country’s financial watchdog organization, the Financial Services Agency. STO’s are set to become a new way of raising capital in Japan as early as next April when a legal change will make them an option for firms to raise capital from assets like real estate. The legal change reportedly clarifies disclosure requirements and other regulatory issues. Consequently, big Japanese brokerages are increasingly willing to explore possible STO business opportunities. Similar to an initial coin offering (ICO), an STO investor receives a t..
The U.S. Department of Homeland Security has awarded a $143,000 contract to a Vienna-based firm to develop blockchain security solutions. The United States Department of Homeland Security (DHS) has awarded $143,478 to Vienna-based Danube Tech to develop blockchain security solutions. Silicon Valley Innovation ProgramOn Sept. 26, the United States DHS Science and Technology Directorate (S&T) announced in a press release that Danube Tech was awarded a contract to assist the department in its ongoing fight against forgery and the counterfeiting of certificates and licenses. The news release states that services such as U.S. Customs and Border Protection (CBP), the Transportation Security Administration, and Citizenship and Immigration Services can all benefit from blockchain-based security solutions, adding: “Current issuance processes are often paper-based, do not facilitate data exchange, and use among systems and could be susceptible to loss, destruction, forgery and counterfeiting. ..
Major cryptocurrency payment services provider BitPay has undergone a security and confidentiality compliance audit, the Service Organization Control 2. Major cryptocurrency payment services provider BitPay has undergone a security and confidentiality compliance review, the Service Organization Control 2 (SOC 2). Per a Sept. 30 press release, business advisory company Aprio confirmed BitPay’s compliance with the SOC 2, a tech audit and a requirement for technology companies that assures that customers’ personal data is kept secure and confidential. Passing an SOC 2 review means that the firm has met criteria set by the American Institute of Certified Public Accountants in regard to confidentiality, security, privacy, processing integrity and availability. Commenting on the evaluation, Dan Schroeder, partner-in-charge of information assurance services at Aprio, said: “After thorough review, we have confirmed the design and application of BitPay’s payment system meets the standards set ..
A class action lawsuit against Ripple Labs Inc. alleging that XRP is an unregistered security faces another setback. The discourse surrounding the securities laws and the treatment of digital assets continues to draw debate among market participants, regulators and legal practitioners. One of the most high-profile targets in this ongoing debate is XRP, a digital asset issued by Ripple Labs Inc. Despite voluminous public examination, regulators have not reached a consensus on the appropriate treatment for this widely traded digital asset. Amid vociferous debate and clamoring from market participants for clear, concise and practical guidance from the United States Securities and Exchange Commission (SEC), the commission’s approach to the digital asset space to date has been notably sparse and cautious. However, we are currently enjoying a flurry of recent guidance. In April of this year, the SEC published the “Framework for Investment Contract Analysis of Digital Assets,” drawing heav..
A blockchain and a fintech startup partnered with South Korea’s oldest bank, Shinhan Bank, to develop a blockchain-based security solution. South Korea’s oldest bank, Shinhan Bank, partnered with two other companies to develop a blockchain-based security solution. Korea’s Shinhan bank to enhance security with blockchainAccording to a report published on Aug. 14 by local news outlet TheKoreaTimes, Shinhan Bank signed a memorandum of understanding with financial technology startup Ground X and blockchain developer Hexlant to develop a blockchain security system. Per the report, the deal will see the institution’s partners jointly develop a Private Key Management System for its banking services. Ground X is the blockchain unit of South Korean messaging giant Kakao, and is reportedly expected to provide a blockchain-based platform. Hexlant develops the infrastructure to feature an anti-cracking program for the platform. User-friendly UX will help blockchain adoption says ShinhanThe firs..
TZERO has opened up public security token trading on schedule and says they might pay out dividends in Bitcoin or Ether. Retail giant Overstock’s blockchain subsidiary company, tZERO, has opened up its preferred equity security tokens — dubbed TZROP — for trading by accredited and non-accredited investors. TZERO announced the news in a press release on Aug. 12, the previously proclaimed day of the launch. According to the announcement, the TZROP token allows investors to directly participate in the company’s revenue growth via a quarterly dividend model. The announcement further states that the company could distribute a quarterly dividend of 10% of the company’s adjusted gross revenue for TZROP holders. However, it also specifies that this is subject to approval from the board of directors as well as Delaware law and accounting requirements. The company additionally specifies that it could pay out these dividends in U.S. dollars, Bitcoin (BTC), Ether (ETH) or even with more securit..