Updated: Apr 8
Recently I encountered the firm - Stobox (STBU) - which aims to bring STO's as a new form of raising funds.
Capital markets have had the famous IPO - offering part of the company as shares to the general public. ICOs are similar, except related to the supply of cryptocurrencies. Firms are able to utilize the sale of their cryptocurrency to invest in the costs for the underlying project that they are promoting. The issue with ICOs in the United States is that they are heavily regulated and scrutinized, especially due to the substantial amount of fraud associated with them.
When I ran upon Stobox - I found their mission interesting as they advice on a less known way to raise funds utilizing blockchain - Security Token Offerings.
What is a Security Token Offerings?
A security token offering / tokenized IPO is a type of public offering in which tokenized digital securities, known as security tokens, are sold in cryptocurrency exchanges, or security token exchanges.
“Security token offerings” (STOs) share similarities with both initial coin offerings (ICOs) and traditional securities. This unique crowdfunding strategy combines the efficiency of blockchain technology, with the legal protections found in standard securities offerings.
This creates a safer investment climate for potential investors - which in the United States market is critical.
Stobox has potential to be one of the first mainstream advisory companies in the field of securities tokenization. Furthermore, the successful growth of their recently launched token - STBO, would prove their model is a promising strategy for firms looking to raise funds.
They state that they have more than 3,000 hours of research in the industry, powerful tech for compliance, and a vast network of partnerships.
Stobox Technologies, Inc., a Wyoming corporation (Stobox) is a technology firm founded with the goal of utilizing distributed ledger tech to revolutionize financial technologies so that they are more efficient, accessible, and transparent.
They say they are not a registered broker-dealer, funding portal, underwriter, investment bank, investment adviser or investment manager, and is not providing brokerage, investment banking or underwriting services, recommendations or investment advice to any person, nor provide any brokerage or cryptocurrency services.
Looking at the different packages, their lowest cost option includes an entry price of above $30,000 - then 149$/m after.
Security Token Offering Packages
They have prepared defined solutions to meet the demand of different sized clients.
With also the potential to be customized for specific business needs.
Small Package From €29,950 + €149/m
US Company Incorporation
Bank / EMI Account Opening
Prospectus / Private Placement Memorandum
Investment Agreement and Auxiliary Documents
SEC Form D Filing
TECHNICAL & OPERATIONAL
Security Token Issuance on Ethereum Blockchain
Issuer Back Office
Investor's Dashboard - completely digital and automated investor journey
Manual KYC Verification
Manual Dividend Payout
Support in Listing on a Secondary Market
Lifetime Technical Support
While STOs - per various sources are considered mundane in other markets vs. the ICO, this advisory has potential to be very successful in the United States. The regulations and difficulties managing the legal complexities in the US market can be vast and appear daunting to any sized company. The legal landscape for the STO market - while still new, have a more defined rules as to what you can with them in the United States.
A "Security Token" helps use a different framework to define utilizing blockchain technology that is much more compliant. If proved to be reliable as a fundraising instrument, will see a large expansion - and so will the STBU security token.