Site icon Trendslr

What is Security Token Offering (STO) ? | STO Listing websites | Advantages | Disadvantages

What is STO

What is STO

What is Security Token Offering (STO)?

Security Tokens are those tokens that have passed the Howey Test. These tokens derive value from external assets. Security Tokens are subject to federal securities and regulations. These tokens have powerful uses if regulations are properly met. But if the ICO (Initial Coin Offering) does not follow the regulations, these tokens can be subject to penalties. Security Token Offering or STOs are soon to replace the older financial tools with blockchain-based and crypto token assets. It is said that STO is the future, this is because STO is safer because of strict regulations than utility tokens. Like Bitcoins are said to be “programmable money”, security tokens are said to be “programmable equity”. Similar to ICO, STO is the process to issue security tokens after going through checks like KYC.

STO represents ownership information of an investment product, which is recorded on a blockchain. In normal equity stocks, ownership information is recorded on a document and issued as a digital document. But in case of STO, it is recorded on a blockchain  and issue as a ‘token’. STOs provide opportunities for entrepreneurs to raise funds by issuing digital security tokens to investors. This exchange is 100% regulatory compliant.

Advantages of Security Token Offering (STO):-

Below are the advantages that STOs can give in the future:

Disadvantages of Security Token Offerings (STO):-

The main challenges or disadvantages faced by STOs are:

STO Listing Websites

There are several websites providing STO Listings such as listings of Upcoming STOs, Ongoing STOs, Pre STOs, etc.  Some of these sites are:

DAS.Finance
ICO Marks
ICO Rating
ListICO.IO
STO Analytics
STO Check
STO Scope
STMarket.co
Token Market
InitialCoinList.com

Conclusion

The emergence of security tokens and STO has given rise to blockchain technology. It has given rise to prudent cases of uses such as converting tangible financial assets of the “real-world” to security tokens. Security Tokens are soon to play a crucial part in a bigger change towards an open financial market system. With tons of sites, online STOs, etc, a wide range of security tokens can be traded with compliance to regulations, anytime, anywhere, on a global level. This makes it ideal for investors to invest unlike ever before, and for entrepreneurs to raise funds super easily.

(adsbygoogle = window.adsbygoogle || []).push({});
Exit mobile version