So as promised, here are the remaining questions from our Q & A on Digital Securities. If you missed the webinar, you can watch the full version using the link at the end of this post.
ICO vs. STO vs. DSO Webinar Q & A
Oscar Jofre and Darren Marble
April 17th, 2019
Is an ETO (Equity Token Offering) the same as an STO?
ETOs are essentially ICOs that sell “stock shares”, by issuing cryptocurrencies over a public blockchain.
Are there any exchanges today that trade Securities Tokens?
Yes, there are.
In the USA: OpenFinance, Templum, TZero, AX Trading, RialTo Trading, SharesPost
In Europe: Blocktrade
What jurisdictions in the world have regulated STOs?
Securities are regulated in all countries in the world. When you decide to do a Securities Offering you must follow the securities law of each country you are selling the securities into.
Can Securities Tokens be marketed to retail investors?
Digital Securities can be sold via RegA+ which allows you to sell to retail investors worldwide.
If one uses a Reg D exemption for digital security, how does one move to secondary trading of those securities? You cannot publicly trade Reg D securities, correct?
Under RegD 506(c) the investors will be on a 12-month mandatory hold. Once that hold period is removed the company can apply to the Regulated Secondary Market platforms for a listing of their company so their shareholders can trade. Secondary Market is NOT a Stock Exchange
What actions do you see from local regulators to take steps? I believe OSFi in Canada issued some guidance recently, can you speak to the regulatory aspect?
Each Securities Regulator USA (SEC), Canada (CSA and the OSC and many other provincial regulators), Switzerland, Singapore (MAS), China, Australia, have come out with Warnings that if you are selling these Digital Securities, calling them a Token or utility will be deemed a Securities and you will need to make sure that you follow the securities law.
Does a DSO require a Blockchain platform?
Digital Securities are created on blockchain technology.
What do you all think about the liquidity solution that Reitbz offering from BTG Pactual has adopted?
This is not an offering that meets any of the regulatory requirements in the countries we operate on so it’s difficult to comment on something that is not following securities laws. But since it does not, this cannot offer any investor any form of liquidity as it does not meet any of the regulatory securities obligations.
In Oscar’s 1st slide, he states that Digital Securities allows for 24/7 trading. And later on, when talking about Reg A+ advantages, Oscar (I think) said upon closing of Offering, Securities are tradeable. But if there are still no secondary markets, where do they trade?
As the SEC Transfer Agent to many RegA+ companies, we are required to do transfer and trades. Now, these trades are not done on a secondary market, this is where the seller has found a buyer on their own without posting anywhere who is interested in purchasing their shares in the company.
Click on the link below to watch our previous webinars:
Marketing Your Raise From Traditional Capital to Digital Securities