STO Can Be Alternative To Other Financial Instruments
The security token offering (STO) may soon replace ICO and gain popularity among participants of the crypto market, primarily, among companies aiming to attract a substantial amount of capital, Jaron Lukasiewicz, a crypto enthusiast, stated on his YouTube channel.
Lukasiewicz is the founder and executive director of the Influential Capital company. Since 2012, he has been working in the crypto sphere, occupying various positions in firms in the US and Canada. The businessman also has his own YouTube channel, where he talks about the advantages of blockchain and STO.
The crypto enthusiast believes that STO is becoming a serious alternative to private capital and venture financing for companies around the world. According to the representatives of the Polymath platform, the funds raised during STO will increase to $10 trillion in the next two years, and the initial coin offering will become a thing of the past.
STO is more suitable for companies with high growth rates, annual revenues of more than $10 million, as well as those striving for high liquidity and entering the global market. With the help of a security token, it is possible to enter the global financial markets, it contains more favorable conditions and high security, compared to ICO.
Historically, a security was manually signed by the parties of the transaction. The security token performs the same function, and the signature is the transaction in blockchain. This asset can be any financial instrument, including stocks, dividends, income shares, and voting rights.
However, the STO market is in its infancy, Jaron Lukasiewicz states. It is still unclear how it will work in the long run as regulators may influence it and the threat of hacker attacks remains.
As previously reported, the cost of more than 70% of tokens decreased after the ICO.