Page 14 - July 2018 Disruption Report

DIGITAL CURRENCIES JAJNULAYRY20210818
In Legacy finance we use both Debt and Equity. In Crypto Token Finance we use both Utility and Security Tokens. ...A Security Token is referred to as an Asset Token in some jurisdictions (e.g in Switzerland which is leading the pack in Crypto Token Finance). Any asset can be tokenized—it could be Public Equity, Private Equity, Real Estate, Funds, Bonds, Gold, Diamonds, IP Assets, etc.
Tokenization enables:
1. Real Time Settlement....
2. Easy Fractionalization; for example buying a share of a commercial property not the whole building.
3. Trust through verifiability and immutability (described below)
Easy fractionalization through tokenization will open up many new markets to a much bigger pool of investors. That leads to liquidity. It is a win/win/win:
Win 1: Entrepreneurs can more easily raise capital.
Win 2: Investors can get liquidity more quickly.
Win 3: Intermediaries who add value will have many more assets to work with.
...Now lets look at the third enabler of Crypto Token Finance—trust through verifiability and immutability.
Trust through verifiability and immutability
If you are an accredited High Net Worth Investor (HNWI) who is active in Angel Investing
or you run a VC fund or invest in VC Funds, you might say “who needs Tokens, I can sell assets on secondary markets today”. True, because HNWI have lawyers and accountants and other professionals who can do the required due diligence (DD) work and deal with
all the paperwork. Real time settlement enables those assets to be traded immediately. Fractionalization brings in more buyers. None of this makes sense if you are dealing with scanned documents, analog audit processes and all the other paraphernalia of Legacy Finance. Blockchain based data that is verifiable and immutable can change that game. We are still in the early stages of Security Tokens with changes coming that will enable:
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