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Start Investing Soon with Security Token Offerings — Bitkub.com

Have you heard of STO? DX exchange?

Ten traditional listed companies on Nasdaq have officially entered the tokenization space. Estonia has become the first country to offer tokenized shares. With the current unclear regulations here in Thailand on the nature of Security token offerings or STO’s, this small country in the east of Europe where current temperature resides to -4 degrees, giant conglomerates such as Facebook, Tesla, Google, Netflix, etc. have given green light to DX Exchange, allowing 24/7/365 tokenized shares trading.

According to rumours, DX exchange would both be backed by US SEC and NASDAQ in this fully regulatory compliant, blockchain friendly country that Thailand is slowly aiming to follow. The introduction of STO will most likely give confidence back to crypto investors with the past ICOs shakedown. This is because STOs are required to be fully compliant with the SEC guidelines specific to its country, and should provide similar benefits and risks to traditional shares without the complicated legal structure for current IPOs.

But what exactly are STO?

In the crypto space, we use the word coins and tokens interchangeably. But it is important to know that all coins are tokens. Tokens are thereafter separated, as of now, into 3 different categories. Currency token (BTC, ETH, etc.), Utility token (ERC-20, TRC10, TRC20, etc.), and Security token (STO). Let us focus on the latest. Security token is a new mean offered to people, accredited and non-accredited investors, with some knowledge of finance to invest an amount as little as 100 THB, into a single and ideally a fractional share of traditional assets.

This means that low income earners that have an internet connection can easily start allocating their funds in more fruitful investments instead of putting into saving accounts that rarely exceed the 1.5% annual interest. Put simply, security tokens are synonymous with an investment contract, which means security tokens could represent shares in a company, earnings streams, an entitlement to dividends or interest payments. In terms of economic function, they are analogous to equities, bonds or derivatives.

While it is not yet available in Thailand, Estonia approval for the distribution of STO, will definitely allow countries around the world to examine the potential, distribution method, and outcome of STOs.

What are the benefits of STO?

For future investors, STO will allow for fractional ownership of a single share this would give the possibility for low income earners to diversify their investment portfolio. Having tokenized shares offerings, investors can invest from any geographic location and at any time as the market is not bound to any country. This allows for 24 hours purchasing and trading time around the clock. Moreover, it is said that STO holders will share the same benefits as traditional shareholders in terms if dividend payouts. More interestingly, once clearer fractional ownership dividend distribution scheme will be drawn and regulated, it will allow for low income earners to also reap similar benefits as traditional shareholders.

To recap, STO is a mean to firstly digitize current traditional shares, bonds, etc. Secondly, by tokenizing the assets, we incorporate distributed ledger technologies such as blockchain as a mean of immutable security and reducing hidden transaction fees incurred by the middleman. And finally, the token is publicly traded to the general public through the country’s specific SEC compliant regulations. This includes regular audits, financial statements report, etc. Bitkub Blockchain Technology, providing distributed ledger technology consultancy, look forward for the infinite business opportunities that would arise with such new means made available for the public.

*Bitkub Blockchain Technology is a consulting specialist that is committed to assisting you in every business opportunity, which comes with laws that will be drafted in the near future.
*Remark: There is no law concerning the creation STO and offering of such asset in Thailand.