STM Monthly Report: February 2024

Key Takeaways

Summary of Data

In this month’s market report, we have meticulously tracked over 525 security tokens spanning across 29 marketplaces and 11 blockchains. We actively track key United States Alternative Trading Systems (ATS), including INX ONE, tZERO, and Securitize Markets. In addition, our monitoring extends to international marketplaces, such as Aktionariat, BigONE, Bitfinex Securities, ERX, Levinswap, StellarX, and more. To supplement those marketplaces, Security Token Market (STM.Co) also tracks blockchain-level data.

Market Highlights

337 tokens experienced trading activity in February, up 13.09% from January’s 298 tokens. The overall volume for January greatly increased 20.86% to $5,423,819 compared to $4,487,755 in January 2024.

Throughout the month, the market cap increased, starting at $28,599,754,566 on February 1st and ending at $29,015,733,144 by the close of the month.

Insights: As evidenced in the graph below, significant volume came from Vidby AG ($VIDS) on 2/1/2024 ($567,233) and 2/18/2024 ($600,153). Vidby is a Swiss-based company leveraging advanced methods and algorithms for automatic video and document translation, subtitling, and dubbing— a recommended vendor by YouTube.

Their capital is divided into 3.2M shares with a par value of CHF 1.00 each, of which 241,874 shares are held by the company itself. Based on a registration agreement, 2,114,048 shares of vidby AG are registered as ERC-20 tokens named vidby Shares SHA on the Ethereum blockchain.

Quantitative Highlights

Market Cap

• Total Security Token Market Cap: $29,018,052,368 (4.53% MoM)
• International (Non-US) Market Cap: $28,710,284,995 (4.61% MoM)
• US Market Cap: $307,767,372 (-1.97% MoM)

Volume

• Total Security Token Market Volume: $5,423,819 (20.86% MoM)
• International (Non-US) Volume: $4,529,639 (25.00% MoM)
• US Volume: $894,181 (3.49% MoM)

Tokens Tracked

• Number of Tokens Tracked: 525 tokens
• Number of Tokens with February Trading Activity: 337 (13.09% MoM)

Asset Class Breakdown

Asset-Backed Securities

• Market Cap: $5,515,429,160 (6.76% MoM)
• Volume: $424,615 (-10.89% MoM)

Insights: Asset-backed security tokens experienced a slight decrease in volume, while the market cap saw a decent increase, attributed to the onboarding of the Redwood Trust Liquid Mortgage Securitizations (SEMT) to the STM platform which boast an 8.67% monthly growth rate. Currently, our tracking includes 18 major ABS: INX Token, Republic Note, BMN1, and now 15 Redwood Trust Liquid Mortgage Securitizations.

With a market cap of $5,422,400,000, these securitizations now constitute 98% of the total asset-backed securities market cap tracked on STM. Notably, the most recent SEMT securitization was worth $366.4M on February 16th, 2024.

Liquid Mortgage gives investors transparent and efficient access to data, tracking amount borrowed, payment history, documents, loan-level data, and more. The blockchain can help reduce friction points throughout the life of the loan thanks to streamlined diligence, reporting, and data providing more consistent insight such as borrower payment and prepayment activity.

With a permanent digital record of loan data, mortgages should be able to be bought and sold in a much more commoditized manner, with a level of accuracy and transparency that surpasses current industry processes. — Fred Matera, Managing Director and Head of Residential at Redwood Trust in a Press Release

Pooled Investment Fund Interests

• Market Cap: $110,925,095 (21.96% MoM)
• Volume: $63,015 (-36.32% MoM)

Insights: Pooled investment fund interest tokens saw a rise in market cap alongside a noticeable dip in trading volume. Our tracking pool includes 20 pooled investment fund interest tokens: RealUnit Schweiz AG, SPiCE VC, Science, Protos, Blockchain Capital, 22X Fund, EnergyFunders Yield Fund I, LLC, and 13 WisdomTree Prime Digital Funds.

The decrease in volume was primarily influenced by RealUnit Schweiz AG, which experienced a moderate drop from $86,210 to $52,147. Conversely, the increase in market cap was driven by the addition of the 13 WisdomTree Digital Funds, contributing just under $20 million.

The 13 WisdomTree Digital Funds are available on their WisdomTree Prime app (in 38 states). The beauty about this app is that retail investors are using blockchain without even knowing it, it’s that user-friendly. The whole premise of tokenizing assets isn’t to make everyone create web3 wallets, it’s to use blockchain technology in the backend to streamline inefficiencies for issuers and service providers while providing additional value to the end investor.

Want to learn more about WisdomTree? Check out the fireside chat we hosted with their Director of Business Development for Digital Assets, Maredith Sapp, at our TokenizeThis 2023 conference (TokenizeThis 2024 tickets are now available)!

Real Estate

• Market Cap: $232,579,286 (6.09% MoM)
• Volume: $101,026 (-39.75% MoM)

Insights: Real estate tokens have demonstrated a slight increase in market cap but significant decrease in trading volume compared to January 2024. While the graph below displays a spike in volume every few months over the past year, that trend may become more frequent this year as more tokens come to market and make their way to secondary trading venues.

As for the primary market, we’ve seen new offerings and platforms come to light including McNeill Investment Group, RSRV, MetaWealth, and Coreestate to name a few. These will make their way to the secondary market soon enough which STM will be tracking.

RealT has been the go-to example of secondary market activity with 400+ trading assets and growing. Now they’re practicing what they preach and tokenizing themselves as their way of commemorating their 5th anniversary. Leveraging a Swiss framework, RealT’s offering has a $50 minimum investment with a cap of $5M and will be “globally accessible on secondary markets such as the YAM platform and decentralized exchanges (DEXs) on chains like Gnosis, Ethereum, and Polygon. This approach not only broadens investor accessibility but also significantly enhances liquidity,” according to the press release.

Equity

• Market Cap: $17,307,270,568 (-0.00551% MoM)
• Volume: $4,835,164 (29.12% MoM)

Insights: Equity security tokens observed a significant uptick in volume compared to January, while the market cap remained stable. Enegra Group Token ($EGX) stands out as the leader in the equity market, boasting an average market cap exceeding $17 billion this month. In January, 21 equity tokens had trading volume, with the top 3 performers being Enegra Group Token (~$2.07 million), Vidby Shares SHA (~$1.36 million), and Realio Security Token (~$730,000).

One of the top trading tokens, Realio Security Token ($RST) offers ownership and profit share rights in Realio Technology LTD, along with staking and utility features for network participation. Holders can anticipate equity returns from both Realio Technology LTD and the Realio Network, while RST actively trades on UniswapV2. In February, RST demonstrated impressive volume, exceeding $150,000 on the 14th and 29th. The closing price exhibited a notable 21.79% increase from the month’s start at $0.78, reaching a high close price of $0.95 on the 13th.

New Asset Class: Institutional Debt

• Market Cap: $5,851,848,258 (17.62% MoM)
• Volume: Currently Not Available

Insights: The STM Team has now onboarded institutional debt token offerings to STM.co, with a decent growth in market cap throughout February. The Hong Kong Digital Green Bonds stood out this month as they’re the first tokenized multi-currency offering denominated in HK dollars (HKD), Renminbi (RMB), US dollars (USD) and euro (EUR) under the Government Green Bond Program.

The Government of the Hong Kong Special Administrative Region of the People’s Republic of China (the HKSAR Government) on 2/7/24 announced the successful offering of around HK$6 billion worth of digital green bonds which used HSBC Orion as their issuance platform and are listed on the Hong Kong Stock Exchange. Each tranche has its own page on STM.Co, featuring their distinct terms including their ISIN, size, and coupon.

Filter by asset class on STM.Co to see all onboarded bonds

Marketplace Spotlights

tZERO

tZERO is one of the United States marketplaces tracked on the STM platform. Functioning as an Alternative Trading System (ATS), it features a market cap surpassing $133,184,150 in assets as of February 29, 2024. Among its diverse offerings are three notable equity tokens: Curzio Research ($CURZ), tZERO Token ($TZROP), and XY Labs Inc. ($XYLB). The platform also lists the real estate security token AspenCoin St. Regis ($ASPD) and the pooled investment fund, Energy Funders Yield Fund I Token ($ENFD). The TZROP token consistently leads in trading volume on tZERO month after month, recording an impressive figure of over $375K in February. Following closely is $ASPD with a substantial volume exceeding $75K, trailed by $ENFD, $XYLB, and $CURZ with volumes of $10.8K, $5.7K, and $1.5K, respectively.

ERX

ERX is an international marketplace regulated by Thailand’s Securities and Exchange Commission. Two of STM’s tracked tokens, SiriHubA and SiriHubB, are available for trading on the ERX platform, powered by the Tezos blockchain.

SiriHub tokens present an innovative investment option in Thailand, split into two tranches: SiriHubA and SiriHubB. These tokens are SEC-regulated (Thailand) and backed by the real estate asset, Siri Campus, which ensures a steady cash flow due to a long-term lease with Sansiri Public Company Limited. With a circulating supply of 160 million for SiriHubA and 80 million for SiriHubB, each tranche was initially offered at a price of ฿10.

The trading volume analysis for both SiriHub tokens reveals notable trends from January to February. During this period, the combined volume for SiriHubA and SiriHubB experienced a decline of -14.36%, decreasing from a total volume of $48,389 to $41,439. Individually, SiriHubA exhibited a strong performance in February, with an impressive 121.69% increase in trading volume, surging from $8,648 in January to $19,171. In contrast, SiriHubB experienced a decline in trading activity, registering a decrease of -43.97% from $39,741 in January to $22,268 in February.

During the period from the beginning of December 2023 to the end of February 2024, SiriHubA exhibited increased volatility, especially towards the end of 2023, with prices ranging from $0.25 to a high of $0.28. Conversely, SiriHubA exhibited minimal price fluctuation in January, maintaining a steady range of $0.26-$0.27. The trend continued in February, with even smaller volatility as the price hovered around $0.26 for the majority of the month.

From the start of December 2023 to the end of February 2024, SiriHubB witnessed price fluctuations ranging from $0.25 to a peak of $0.29. Similar to SiriHubA, SiriHubB maintained a relatively stable price range of around $0.26-$0.27 in January, and this trend persisted in February, with the price remaining around $0.26 for the majority of the month.

On-Chain Treasury Products

In February 2024, the total market capitalization of on-chain treasuries fell to $687,193,019, marking a decline of -19.25% compared to January 2024.

Notable shifts contributed to the February decline in market cap. The Maple protocol experienced a drastic -57.14% drop, decreasing from just over $24 million to around $10.5 million. Its two products, Cash Management Pool (USDC-SPL) and Maple Cash USDT1, had distinctive market caps. Maple Cash USDT1, for instance, decreased from over $12 million in January to $50 by February’s end.

While Franklin Templeton — Benji Investments remained the leader with a market cap exceeding $324 million, it dropped over $8 million from January. Ethereum and Stellar continued dominating as the preferred blockchains for tokenized treasury products, with market caps of $346.7 million and $328.5 million, respectively.

New Tokens and Announcements

Aktionariat Updates

In February, STM onboarded Rüedu Bern AG into its platform. Founded by Tom Winter and Jürg Burri, Rüedu is known for its 24/7 self-checkout farm shops, delivering fresh, local food directly to Bernese neighborhoods and promoting fair and sustainable trade. RUEDS is actively trading on the Aktionariat secondary marketplace, and as of February 29, 2024, it reflected a market cap of $452,730, with a price of $90.55.

RealT Updates

In February, STM onboarded 29 RealT tokens into its platform, most of which were properties in Ohio. As per usual, RealT offerings are filled within days if not hours and swiftly transition to trade on the secondary markets where STM is tracking them. As mentioned in the real estate section, RealT is now tokenizing itself and STM will be tracking its performance once the RealT Raise Token starts trading on secondary markets. Learn more from CEO Remy Jacobson in Security Token Show Episode 224 (19:35).

Institutional Debt Updates

The STM Team has been hard at work onboarding institutional debt offerings with February-issued debt including:

• Hong Kong Digital Green Bond — 2B HKD Tranche
• Hong Kong Digital Green Bond — 1.5B RMB Tranche
• Hong Kong Digital Green Bond — 200M USD Tranche
• Hong Kong Digital Green Bond — 80M EUR Tranche
• City of Lugano — 100M CHF 2
• Daiwa Securities Group 1st Unsecured Security Token Bond
• Okasan Securities Group 100th Anniversary ST Bond
• Canton of Basel — 105M CHF
• Canton of Zurich — 100M CHF

Note: Institutional bond listings are for informational purposes only, highlighting the issuance information. Trading data is currently unavailable.

WisdomTree Updates

WisdomTree is a $94B asset manager well-known in the ETF space. Last year they made headlines for a total of 13 tokenized funds, all of which are now trackable on STM.Co as of February 2024

Note: Market cap on STM.co reflects the Net Asset Value of these funds.

About Caleigh Crossman, Data Operations Lead

Caleigh Crossman is STM’s Data Operations Lead where she spearheads the tracking and analysis of over 500 security tokens, offering valuable insights for market sentiment and comprehensive analyses. Her initiation into web3 began with pivotal contributions to the technical development of a RegA+ offering platform. This hands-on experience equipped her with a deep understanding of both technology and the regulatory landscape in tokenized securities. Beyond data management, Caleigh crafts detailed analyses, providing nuanced perspectives on market trends. Her technical expertise and industry insight contribute significantly to STM’s mission of innovation and transparency in the tokenized securities space.

About Jason Barraza, COO

Jason Barraza is the COO at Security Token Market, overseeing STM operations and future initiatives aimed at enhancing data transparency and media coverage within the tokenized securities space. During his time on Wall Street, Jason served at Bank of America’s wealth management division, exposing him to the challenges of the current archaic system. Prior to that, Jason’s professional journey was characterized by a diverse background in consulting and entrepreneurship. Notably, he evaluated over 100 businesses across multiple industries, identifying potential avenues for change and improvement. In addition to day-to-day operations, Jason writes the What’s Drippin’ newsletter and plays a key role in spearheading Security Token Market’s flagship event, the TokenizeThis conference.

About Herwig Konings, Partner, Founder & CEO

Herwig Konings is a veteran and pioneer in the industry due to his background in equity crowdfunding. In 2013, he founded compliance software firm InvestReady which provides accreditation software and other tools to issuers, investment banks, Fortune 500’s, tokenization platforms, and brokerages/ marketplaces. He also served as the Managing Director of the Miami Venture Capital Association from 2016 to 2018 and has been awarded the Miami Technology Leader of the Year award by the Greater Miami Chamber of Commerce in 2015. He frequently speaks at various Universities, for corporate clients, and has taught the Florida BAR CLE blockchain course. Herwig co-authored Blockchain Explained: Your Ultimate Guide to the Tokenization of Finance, an Amazon Bestseller in the Business Law Reference category.

Please be aware that anything stated, mentioned, referenced, linked, or covered in this publication is neither financial nor legal advice. The Security Token Advisors and Security Token Market teams may own or consider owning one or more of the cryptocurrencies, security tokens, stocks, ETFs, and other financial investments included in this report.

Please do your own research on any financial and legal decisions, and consider consulting a financial advisor and/or attorney before making any decisions or choices that may be reflected in this publication.