Crowdfunding giant Indiegogo, known for the creation of projects like the Wardenclyffe Tesla Science Centre, recently stepped into the security token market with the announcement that the company would tokenize the St. Regis Aspen Resort in Colorado and sell the tokens as legally-registered securities in a security token offering (STO).
Indiegogo co-founder Slava Rubin spoke with CCN.com to discuss securities regulation and what that means for the cryptocurrency space.
“In 2018, we’ve seen regulators, especially here in the US, take a more proactive approach toward understanding and regulating these offerings to make sure interests between investors and companies are aligned. As guidance has become clearer around how to do these offerings legally, there’s been a real shift in the desire for security tokens, as they offer a natural bridge between the crowdfunding element of an ICO and the regulatory clarity of a securities offering.”
Rubin believes that STOs will soon become the norm because they, unlike an ICO, provide a clear path as to how to conduct a sale legally. Similar to equity crowdfunding, which Indiegogo launched back in 2016, Rubin sees this as a natural evolution in democratizing access to capital and investment opportunities.
“We predict a rise in the potential and demand for tokenized securities, because digital ownership on the blockchain provides so many advantages over legacy investments, and tech-savvy investors are seeing the value proposition in real time. This addition to our business is just a natural extension of our vision for a crowd-financed world.”
We asked Rubin for his thoughts on ETFs and Wall Street investment — Rubin stated that, “Growing pains come with any industry as it looks to grow and mature,” describing bitcoin ETFs as one of many initiatives industry leaders are taking to expand the exposure of digital assets to the general public and adding:
“It’s not for us to say whether they are good or bad, but we are supportive of many different projects that are aimed at helping bring new and outside interest to our budding industry.”
ICE and other Wall Street players, in Rubin’s view, contribute to the further validation of the space, and he welcomes their involvement in what he sees as the process of legitimizing the industry.
The crowdfunding pioneer went on to explain what drew Indiegogo to ICOs in the first place.
“In many ways, we saw ICOs as just a natural evolution of what Indiegogo has been doing for nearly a decade – which is to help people raise money on the internet for projects their communities are excited about. While we loved that people around the globe were embracing ICOs as a form of fundraising, we wanted to make sure that should Indiegogo get involved, we were doing it with the utmost level of compliance.”
Rubin stated that tokenization of securities held the most disruptive potential in what he refers to as a cryptocurrency revolution, but advises people to take care that their investments are compliant with regulations.
“Like any investment, we always recommend doing your homework and diligence before sending money. One of the main benefits of doing a compliant securities token offering is the SEC has created clear guidelines for providing risk factors and transparency to potential investors.”
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Last modified: May 20, 2020 6:02 PM UTC