Since last year, there has been an immense growth of digital assets. These coins or tokens, as they are referred to, serve a multitude of purposes, powering each of their projects built on blockchain technology. Made famous by the pioneering bitcoin, there are more than 1600 listed on coinmarketcap.com, the largest list of active coins and tokens.
Like all disruptive technologies, blockchain has its impact. Many platforms that have designed native tokens initially were declared as securities by regulators, leading to an apprehension in the market. Developed by people more adept at technological aspects, the legality of the tokens to be securities created confusion and most developers shied away from it all together by creating what is known in the market as ”utility tokens”.
The extent of ignoring blockchain for securities can be seen from a single fact that of the 86 tokens launched in the first quarter of 2018, only two were securities related. The rest were classical utility tokens.
Why Not Securities?
The general confusion regarding tokens as actual securities lie in the complex financial and regulatory requirements that exist:
- AML and KYC process for all investors- an important step to ensure that each investor is a credit entity and does not have laundered money.
- Different approvals and licensing. This becomes more complex as more and more legal jurisdictions get involved.
- A controlled trade of issued tokens, so that it is always traded between approved investors, even in secondary markets.
- Each issued token is to be backed by a real asset, such as fiat. The fact that most ICOs are done to raise money, is the biggest hindrance itself.
Each of the above stated points requires a complex team of legal, financial and regulatory experts. Covering all bases is a tough task and then comes the issue of finances itself. Most ICOs are designed to raise money that the team does not possess and has little assets to back up the tokens in case investors want their money back.
Another issue faced is that according to laws that govern securities, many are considered as having ownership rights, such as shares. Tokens issued are specifically declared as not giving any ownership rights.
Mobu: Solving The Securities Issue
Mobu is a platform that has been designed to cater to the untapped digital securities market. An ICO launch pad, the platform gives solutions to organizations and companies who want to issue securities on the blockchain market, but do not possess the expertise or the experience to do so themselves.
With its vast array of services, Mobu intends to:
- Release compliant security tokens that are backed by real assets.
- Have extended and real KYC and AML checks on all investors.
- Ensuring rights of all investors are safeguarded.
- Multiple jurisdiction approvals and licensing for security offerings and floatation.
- Escrow services to ICOs.
- Liquidation of assets by investors.
- Voting rights.
With such services, Mobu enables companies and firms to let the platform take care of the legal technicalities, provide a single point of floatation of securities and directly connect registered investors for greater accessibility to the market.
These services also ensure that ICO launching companies can let Mobu handle the event, while the firm’s team can concentrate on the development of their core services and objectives. This is a very important aspect for companies to enter the blockchain market with their securities. If they are not bogged down by technical issues of creating tokens and issuing these, they can dedicate their time to their businesses and thereby, creating more value for investors.
Benefits Of Mobu Over Traditional Securities Market
Mobu, in its effort to connect the digital age with traditional securities market, offers certain advantages that are unique to the blockchain sector:
- Lower Fee: In a normal securities market, the cost of issuing new securities, such as bonds and shares are quite significant. These include commissions by brokers, agents and banks. Since ICOs connect the issuer directly with the investor, the cost is much lower.
- Faster Deals: Since everything is digital and there are no intermediaries to slow trades down, the deals made are near instantaneous.
- Broader Exposure: Since anyone with an internet connection can sign up, investor base increases a lot and therefore, more sales are made.
- Decreased Manipulation: Since blockchain’s biggest advantage in a closed environment is its transparent nature, it is difficult to manipulate prices of tokens without someone noticing it.
- Smart Contracts: This means that under pre-defined circumstances, the execution of trades and liquidation can occur without human intervention, making Mobu one of the fastest security trading market in the world.
Considering that as of this moment, there is no other platform that offers security exchange services on the blockchain, Mobu is in a unique position, not only from a marketing and a financial perspective, but eventually, its services will outpace traditional markets and bring in a whole new era of securities trading through decentralized platforms.
Visit Mobu.io for more information.
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