We hosted our first London Meetup! Introduction to Security Tokens
On Tuesday, December 4th we hosted our first Security Token Meetup event in London. It was a full house as a range of professionals coming from traditional finance, real estate and technology gathered to learn about the emerging security token industry. From our team, Steve Sillam, Michael Abib and Lior Abehassera spoke to educate the audience on the state of security tokens and tokenized assets.
The evening was full of discussion as the audience asked a variety of questions to the presenters. The whole room engaged in a conversation around the state of security tokens in today’s early ecosystem and how tokenization is starting to take shape across various asset classes.
Our Head of Financial Engineering, Michael Abib, began the evening by giving a brief introduction to security tokens, mapping out the difference between payment tokens, utility tokens and security tokens. He then proceeded to speak on the current regulatory landscape on blockchain & security tokens. He also covered the Howey Test, a test created by the US Supreme Court in 1946 to determine whether an instrument qualifies as a security. There are four requirements :
- Investment of Money
- In a ‘common enterprise’
- With an expectation of profits’
- ‘Solely on the effort of others’
This opened up the topic to the different classifications that a token can be grouped under i.e. investment or actually have a real utility.
Lior Abehassera, our Head of Investor Relations was the next to speak. He discussed how security tokens will create a new world of finance. He shared with the audience about the benefits of investing via tokenized shares.
His presentation emphasized how the code embedded within the tokens smart contracts should require all investors to pass KYC and AML, before becoming a security token holder. Smart contracts also allow for specific terms of a transaction to be specified, that may differ between jurisdictions. Tokenization provides additional benefits such as fractional ownership, and potentially enhanced liquidity for some illiquid assets. Finally the use of blockchain based tokens make it possible to remove some middlemen, bringing considerable cost reductions.
Steve Sillam, our CEO, concluded the evening by discussing a specific use case of security tokens. How Leaseum Partners plans on tokenizing a Real Estate fund. He began by positioning a tokenized Real Estate Fund as it compares to Listed & Unlisted Funds.
By tokenizing a Real Estate Fund, barriers to entry become lower for investors. Real Estate Investment Management will become more accessible thanks to Blockchain Technology. Investors will be able to benefit both from increased liquidity over a direct investment or a private fund (usually their capital is locked-up for 5–10 years), but still benefit from the strong target returns of Private Equity type instruments.
A few important takeaways from the evening:
- Digitally tokenized assets retains both the characteristics and value of the underlying asset, while bringing considerable benefits to the asset class.
- The security token ecosystem is new but it is rapidly expanding. The infrastructure is already being set up: exchanges, custody, compliance consultants.
- While the environment is evolving, a marked difference remains between utility and security tokens; it is important to constantly stay up-to-date with the latest developments.
Other companies in the security token space to look at:
- Custody: BitGo, Fidelity Digital Assets, Kingdom Trust, Prime Trust
- Exchanges: SIX, Templum Blog, Malta Stock Exchange, OpenFinance, Archax, Coinbase, tZero, GBX
- Security Token Offerings: Leaseum Partners, SPiCE VC, 22xFund, Blockchain Capital, Lottery.com, Corl, MovieCoin
About Leaseum Partners
Leaseum Partners is utilizing blockchain technology to disrupt traditional processes associated with investing in commercial real estate by providing token holders with dividends, voting rights and capital gains rights.
We are currently finalizing our White Paper, which will fully detail our business model as well as the technical details associated with Leaseum.
In the meantime, stay updated on our progress:
- Visit our website
- Subscribe to our telegram announcement channel
- Follow us on twitter
- contact@leaseumpartners.com
Disclaimer:
This article is given for information purposes only and no part of it is legally binding or enforceable, nor is it meant to be. Whilst we believe that the information provided in this article is reliable, its accuracy is not guaranteed and no warranty is given or implied. Certain statements contained in this article constitute forward-looking information involving known and unknown risks and uncertainties, which may cause actual events to differ materially from the estimates implied or expressed in such forward-looking statements. More information about the ICO is available at https://www.leaseumpartners.com
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