The security tokens industry remains a very intriguing market to keep tabs on. More and more companies explore the tokenization of securities using blockchain technology. As the security token market cap approaches $900 million again, there is much to look forward to.
Security Tokens Remain Hot
Although one may argue there isn’t much excitement in the security tokens industry yet, the available offerings all contribute value. Reputable companies tokenize their securities on the blockchain to cater to as many potential investors as possible. Thus, it is a revolutionary opportunity for consumers to gain exposure to companies’ performance without a complicated process.
Several security tokens have proven rather popular in the past few months. Three projects have over a $100 million market cap, including Overstock, INX Limited, and tZERO. Blockchain Capital is not too far behind. Other projects are smaller in market cap size, yet they span many different concepts and business models, creating a versatile and robust market that offers something for everyone.
The launch of INX Limited’s security token is intriguing for multiple reasons. The company provides cryptocurrency trading, digital asset brokerage and dealership, and ATS, combined with an interdealer broker. Their primary audiences are retail clients and institutional players. By creating its INX security token, holders receive a share of the annual 40% positive net operating cash flow distribution.
However, security tokens can also have utility. In INX’s case, it is used to pay for trading fees on the crypto trading platform. The dual-pronged approach brings a lot of positive attention to the overall project, as it combines security and utility characteristics under one banner. The token price has been on a bit of a rollercoaster already, yet it appears the concept holds a lot of value to many people.
What Comes Next For STOs?
It is still early to gauge the overall success of security tokens. The STO model of raising funds has tremendous potential, although it may not suit every business or company. Those willing to take the plunge have a new opportunity at their disposal to attract investors who want to see companies and projects grow rather than just seek an immediate return on investment.
Making security tokens more accessible is one avenue to pursue, though. In addition, several of these tokens are on Uniswap or StellarX, indicating that cryptocurrency users may have exposure opportunities. Thus, there is still tremendous potential in the STO industry, even if it isn’t generating too many immediate headlines these days.
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