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Standard Tokenization Protocol Raises $7 Million, Aims for Compliant Tokenization of Assets
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In a recent press release, the Standard Tokenization Protocol (STP) announced they have secured $7 million after two private funding rounds.
How the Standard Tokenization Protocol Raised $7 Million
After two funding rounds with participants including Neo Global Capital, BlockVC, and AlphaBit, STP has raised $7 million to further develop its protocol.
The protocol aims to handle the full process of regulatory-compliant asset tokenization.
It will use an on-chain compliance verification mechanism to ensure all relevant requirements— to include KYC / AML verification along with user-specific needs— are fulfilled.
The idea, says STP, is to combine the benefits of an IPO, an ICO, and blockchain-powered smart contracts.
STP and the Importance of Compliance in Tokenizing Assets
According to its whitepaper, the STP claims their platform is “providing an easier solution to issue fractionalized ownership of traditionally illiquid assets, which equates to a $256 trillion market”.
They are doing this through the STP-standard, which is open-source and focuses on the compliant tokenization of assets. STP claims their protocol handles all of the necessary regulations, from asset issuance to transfer, between countries and across ERC-20 platforms.
Such compliance is especially important for security tokens. US Securities and Exchange Commission (SEC) Chairman Jay Clayton has publicly stated how nearly every ICO he has seen, constitutes a securities offering. This type of regulatory landscape explains the ongoing shift towards Security Token Offerings (STOs), which saw a 130% increase in Q1 2019.
In differing from ICOs, compliant STOs incorporate the SEC’s existing laws and regulations, and thereby provide the regulatory safety which is currently unseen in ICOs.
What do you think of the Standard Tokenization Protocol? Let us know what you think in the comments section below.
Image courtesy of STP.
Tim Fries
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
