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Innovating Markets: Rise of Security Token Exchanges 2019

Inno­vat­ing Mar­kets: Rise of Secu­ri­ty Token Exchanges 2019

Issuers, as well as buy­ers of secu­ri­ty tokens (STO’s), must fol­low cer­tain rules and reg­u­la­tions and many things have to be con­sid­ered. For exam­ple, it must be pos­si­ble to deter­mine who the right­ful own­er is and who can be con­tact­ed in case of a failed trans­ac­tion. Up to now, there are still some ques­tions that need to be clar­i­fied, and the reg­u­la­to­ry envi­ron­ment is still under­de­vel­oped. For this rea­son, many exchanges have been hes­i­tant about this form of security.

In 2018, secu­ri­ty tokens were not per­mit­ted by any exchange, but this will dras­ti­cal­ly change in 2019 – more and more exchanges are start­ing to list the tokens or pro­nounce to do so, as reg­u­lar­ly aspects will become clear­er in the future.

What exchanges already trade secu­ri­ty tokens?

Here is a list of exchanges that already trade secu­ri­ty tokens:

  • Lykke: A Swiss exchange where com­pa­nies can issue equi­ty and bonds.
  • CEZEX: Philip­pine based com­pa­ny oper­at­ing out of Hong Kong — pos­si­ble to trade secu­ri­ty tokens, backed by stocks, real estate, bonds and commodities.
  • Block­tradelocat­ed in Liechtenstein.
  • Open FinanceUS-based com­pa­ny (using SEC com­pli­ant standards).
  • DX.exchange pos­si­ble to buy bluechip stocks trad­ed on NASDAQ on blockchain (reg­u­lat­ed under the Euro­pean Union’s MIFID II direc­tive and holds oper­at­ing licens­es with the Eston­ian Finan­cial Intel­li­gence Unit).

These are the pio­neers in trad­ing secu­ri­ty tokens, but many oth­er exchanges will start to list tok­enized assets very soon, start­ing from Q2 in 2019. The Mal­ta-based exchange LXDXthe Lithuan­ian Des­i­co, that is ful­ly reg­u­lat­ed under EU law, the Liecht­en­stein Cryp­toas­sets Exchange LCX and many oth­er ones belong to these plat­forms. So, 2019 is going to be the year of secu­ri­ty tokens. They are a true rev­o­lu­tion to the tra­di­tion­al form of invest­ing and it is believed that a mas­sive amount of cap­i­tal will also flow from Wall Street to STO’s with­in the next years.


Pho­to Cred­it: Black Man­ta Cap­i­tal Partners