Keeping the benefits of security tokens in mind, many corporate giants have built platforms to trade security tokens and provide institutional investors with an easy and secure way to start investing in blockchain technology.

NY Stock Exchange’s founder recently announced a new venture, Bakkt, a platform that allows buying, selling and storing of digital assets. Also, the Swiss Exchange Platform has planned to develop a regulated exchange for tokenized securities.

Security tokens have the potential to offer investors the security of a regulated instrument combining agility and the speed of blockchain.

Let’s take an example of corporate equity. No doubt that the companies share have been available for purchase since the ancient times of Rome, but the most advanced exchanges around the world need two days to clear settlements. With the implementation of the blockchain, the time could be reduced to a few minutes.

This transformation will not be that easier. Security tokens are far complex than ICOs or cryptocurrencies and therefore, investors require its more in-depth understanding.

As security token offerings need to comply with the SEC’s rules and regulations, it means security tokens have to incorporate many more legal contracts.

The rewards for developing a comprehensive system for security token exchange could be enormous. Around $256 trillion of real-world assets exist in the world and associating them to the investors through blockchain could bring a massive change in the financial markets.

The opportunity for crypto securities is genuinely vast, regarding the asset classes such as fine art and real estate that have suffered a lot in history due to restricted liquidity and commerce.

“But security tokens can unlock the liquidity of real-world assets by connecting them to the blockchain.”

We shall now discuss how regulations can have an impact on the security token offering.