ISAO as an Alternative to ICO: The BANKEX Solution

No one can question the important role Initial Coin Offerings (ICOs) have played in allowing businesses was to raise the capital to invest in assets that will allow them to expand and maximize their profits. ICOs enable companies to issue their own cryptocurrency that can be sold and traded, and in turn help raise the necessary capital to streamline their projects and scale faster.

Moreover, ICOs allow investors to add to their portfolios and get into the market of financing new ventures early in their lifecycles.

While ICOs have been embraced by numerous technology oriented companies, traditional brick-and-mortar businesses have largely lagged in taking advantage of blockchain technology based capital building tools.

Responding To The Challenge

BANKEX, a blockchain protocol that solves the issue of non-fungible asset liquidity, has responded to this challenge with what it calls an Initial Smart Asset Offering (ISAO), a way to raise capital for the traditional brick-and-mortar business sector by tokenizing real assets, whereby assets are transformed into digital form and placed on a blockchain.

ISAO, in essence, is the initial offering of a smart asset, an asset that is already tokenized. This tokenized asset is in turn made available for purchase to investors using the BANKEX ecosystem.

It is important to point out that neither tech startups nor RnDs can participate in ISAOs.

Support At Every ISAO Stage

BANKEX provides technical support in deploying ISAOs at every stage, from the initiation of an asset tokenization to closing the deal with an investor. Decentralization of this process on the blockchain brings transparency, speed and reliability.

To be eligible for tokenization, an asset must have the capacity to generate cash flow. Beyond this feature, there are no limits that prevent a chosen asset from being tokenized. This feature also makes the token appealing to investors.

Using the PoA protocol, BANKEX helps companies run their ISAOs successfully, bringing value to investors, namely the ability to gain a stake in a business venture early on. The protocol also gives investors the ability to track their portfolio profitability and multiply their income.

A Use Case

A developer looking to build a skyscraper could, for example, utilize an ISAO to secure the necessary funds to build the skyscraper at the most opportune time. He accomplishes this by providing BANKEX the necessary information such as land ownership papers, project plans, and contractual obligations with subcontractors.

In this example, the asset would be the square feet of offices to be built. The tokens issued would be backed by the square meters of the future building. One token can be denominated to cost the equivalent of 1 square meter of office space. Every investor that buys a token will receive profit from the further rent of the offices and be able to sell back his/her tokens at market price to late investors or back to the developer.

BANKEX and the asset owners would organize the exchange for selling the tokens to investors. A third-party auditor would manage the escrow.

An ISAO will prove helpful in many use cases. In the case of the aforementioned real estate developer, the developer became aware of the opportunity based on his involvement in the real estate market, but was constrained in his ability to qualify for traditional loans because of previous loans he had not yet paid off.

A New Generation Of Assets

The BANKEX protocol will enable a whole new generation of assets and contracts called decentralized capital markets using the PoA protocol, which combines BaaS and blockchain technologies.

This technology also enables financial information to be delivered in real time directly into the blockchain, meeting the rising demand for facilitating liquid assets without facing the administrative procedures of traditional stock market compliance.

PoA will become the industry standard for creating decentralized capital markets.
At the present time 10 banks and several leading technology providers, including Microsoft, support BANKEX.

BANKEX is a TOP-50 global fintech company and among the Top-9 most promising ICOs in the world. The Token Sale date has been set for Nov. 28.

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