On April 10th 2019, Provenance.io Blockchain announced a successful Security Token Offering (STO) which raised $20 million. The funds will go towards the further development of Provenance.io and its administrator, Provenance Blockchain Inc., which are now independent entities.
Provenance.io Blockchain’s $20 Million Security Token Offering Explained
Provenance.io was named ‘Blockchain Innovator of the Year’ by LendIt in 2019.
Now, after a successful Security Token Offering, provenance says the $20 million raised will support the further expansion of the Provenance.io ecosystem.
The Reg D private placement saw participation from both blockchain and traditional technology investors.
Also revealed was Provenance.io and its administrator, Provenance Blockchain Inc. (PBI), as becoming two independent entities. Provenance.io was built by Figure Technologies, and now Figure has announced that Provenance.io and PBI will function independently going forward.
The funds raised will aim to staff PBI and finance operations, and will include the areas of compliance, technology, and business development.
How the Provenance Security Token— ‘Hash’— Works
Provenance.io’s security token, Hash, represents equity of the blockchain.
The security token serves two purposes: it allows for the distribution of fees paid to Provenance and it enables a voting infrastructure for PBI.
Jenny Johnson, President and COO of Franklin Templeton, a founding node manager for Provenance, described her faith in the Provenance vision:
“Blockchain technology will disrupt financial services in ways that unlock tremendous value through improving current processes but also introducing new ways to do business. We are excited to facilitate and support blockchain adoption because change will happen when the technology is embraced by the market. The technology platform combined with the ecosystem makes Provenance stand out.”
Sheila Bair, former Chairwoman of the FDIC, commented on the potential benefits that Provenance.io can bring to the financial industry.
“This is a seminal moment for the blockchain industry in financial services. Provenance.io has the potential to bring massive improvements to the industry, across asset originators, the buy and sell side, as well as regulatory benefits and better consumer protections. In particular, it will provide loan-level transparency around the quality of securitized assets and a clear, unalterable record of ownership—two things that were sorely missing during the financial crisis.”
Bair— one of TIME Magazine’s 100 most influential people in 2009— has a history of publicly advocating for clear regulations concerning digital assets.
According to U.S. Securities and Exchange Commission (SEC) Chairman Jay Clayton, clear regulations already exist: the commission’s existing securities laws.
As a result, the security token industry has emerged. For more on the use-cases of security tokens, be sure to review our comprehensive security token guide.
What do you think about Provenance.io’s successful Security Token Offering? Will STOs become the norm when it comes to raising private capital? We want to know what you think in the comments section below.
Image courtesy of Provenance.io.