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Real estate leads securitized blockchain assets in 2022 — Report

89% of all traded security tokens are for real estate, suggesting that the blockchain industry may be primed for further adoption of real estate NFTs.

Real estate is an asset class that is ripe for integration with blockchain technology. Security tokens cover many categories but are dominated by real estate. The Cointelegraph Research Terminal is hosting a 33-page report by Security Token Market, a data and media firm, that covers the current state of real estate security tokens and the potential for continued adoption. 

If you represent a real estate firm or have a portfolio that encompasses real estate, this report has the information you need to know on this developing shift in the industry.

Click here to purchase the full report, complete with charts and infographics.

Blockchain is changing the real estate industry

Nonfungible tokens (NFT) have been rising in popularity over the past few years and really skyrocketed to new heights in 2021. Some of the negative press on NFTs is that they are only used for pixelated pictures of JPEGs and have no “real world” applications. Those familiar with the blockchain and crypto space know that the use of NFTs goes way beyond pixelated apes and Shiba Inu memes.

The report goes deeper into the utilization of blockchain projects currently tokenizing real estate. The report gives a general overview of the current state of the primary tokenized real estate market, 14 active projects working in this space, and how these real estate tokens are trading on secondary markets.

The perfect application of blockchain technology

The utilization of security tokens covers a wide variety of industries from fine art, wine and insurance, but none are growing as fast as the real estate sector, which makes up 89% of all traded security tokens. Breaking down that 89% further, residential real estate accounts for 87%, while commercial only takes up 2% of what has been transacted as a security token. The global real estate market in 2021 was around $3.38 trillion, and with the rise in different applications that make use of blockchain technology, it is no surprise that the crypto revolution would find its way into real estate.

Ownership of title and property is well-suited for blockchain applications, as triple-ledger accounting (who sold, who bought, and signatures) is built directly into the systems that make up the process of exchange. The verifiability and trustlessness of the technology make it ideal for removing many different barriers to transactions that plague the traditional real estate space.

An example is title searchers and the process of insuring them. It takes both time and money for mortgage lenders and buyers to go through a title search on a property to ensure that the seller has the legal ability to transfer property rights to the buyer. With a tokenized property asset, this becomes a simple task of conducting a blockchain search. This is just the tip of the real estate token iceberg. Purchase the report to find out more.

Nascent and emerging, but growing

In 2019, the first property was minted as an ERC-20 token on the Ethereum blockchain. While it may seem like a slow start to adoption, it must be noted that the real estate industry is highly regulated. Combine this factor with the growing decentralized blockchain industry, and you have a recipe for slow growth — at least initially.

The report explains that the volume of actively traded real estate tokens increased in volume by 107% in 2021 from the previous year. Active projects involve a variety of different facets, including commercial hotels, private estates, Section 8 and affordable housing, purchasing interests through a blockchain IRA account, and insurance. As seen in the chart below, the majority of activity is heavily on the residential side as opposed to commercial.

The process of tokenization adds an element of liquidity to the real estate market, which, historically, has been a known issue for the sector. Investors can also benefit from this by looking to ferret out yield generation with different fractionalization of property on the blockchain, eliminating complicated and expensive barriers to entry. 

Real estate on the blockchain is coming fast

The Security Token Market real estate report is crucial for serious investors to read. Both earlier adopters and those unaware of this sea change can benefit from staying informed on the latest developments highlighted in this report. All industries change, and real estate is no exception. Anyone involved in real estate will benefit from the insights provided by this report to help keep their competitive advantage in the marketplace.

This article is for information purposes only and represents neither investment advice nor an investment analysis or an invitation to buy or sell financial instruments. Specifically, the document does not serve as a substitute for individual investment or other advice.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

Bitfinex security token platform goes live in Kazakhstan

While the Bitcoin mining trading is fading in Kazakhstan, Bitfinex debuts its STO platform with a BTC mining-related token.

Major global cryptocurrency exchange Bitfinex is finally moving forward with its security token platform (STO) in Kazakhstan, opening the first day of trading.

Bitfinex Securities, Bitfinex’s blockchain-based investment platform, is officially starting on Tuesday, the company representatives announced to Cointelegraph.

Announced in September 2021, the new STO platform is regulated within Kazakhstan’s national financial hub known as the Astana International Financial Center (AIFC). Bitfinex Securities specifically operates from a special economic zone in Kazakhstan, which has an independent court system, according to Bitfinex Securities chief technology officer Paolo Ardoino. The platform is not available to citizens or residents of countries like Canada and the United States.

According to the announcement, Bitfinex Securities is debuting trading with the Blockstream Mining Note (BMN), a security token offering qualified non-U.S. investors an option to mine Bitcoin or invest in BTC mining stocks using the associated hash rate of BMN. The token is issued on the Liquid sidechain of Bitcoin and will be trading against BTC and the U.S. dollar, enabling accredited investors to obtain exposure to Bitcoin mining.

“This underlines a pent-up demand among accredited investors for the opportunity to obtain exposure to Bitcoin mining, made available by BMN’s enterprise-grade facilities,” Ardoino told Cointelegraph. He added that the company continues working closely with local regulators as well as companies seeking to raise capital on the STO platform.

Related: Kazakhstan likely to lose Bitcoin hash rate leadership in next index update

As previously reported by Cointelegraph, the Bitcoin mining industry has apparently been somewhat fading in Kazakhstan recently as the local government was terminating multiple mining operations and proposing energy price hikes as well as new crypto mining taxes.

As of August last year, Kazakhstan was one of the world’s biggest BTC mining counties in terms of hash rate distribution, housing over 18% of the global BTC hash rate, following only the U.S., according to the Cambridge Bitcoin Electricity Consumption Index.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

MELD’s $1B ISPO highlights emerging use cases for Cardano, crypto fundraising

Roughly 40,000 participants staked nearly 620 million ADA as part of MELD’s first-ever initial stake pool offering, which concluded on Oct. 27.

DeFi banking protocol MELD recently made headlines for attracting more than $1 billion worth of staked Cardano (ADA) to its protocol through a novel funding mechanism called an initial stake pool offering, or ISPO, marking an important innovation in how early adopters support blockchain startups. Cointelegraph had the opportunity to connect with MELD CEO Ken Olling to discuss the significance of the ISPO as well as Cardano’s role in facilitating widescale participation in the stake pools. 

ISPO: An overview

The ISPO is a novel way for investors and other early adopters to support a project by delegating cryptocurrency to public stake pools in exchange for the project’s tokens. MELD is currently the only known project to employ an ISPO even though the concept had been previously proposed elsewhere. 

The MELD ISPO, which was initiated on July 1, allowed Cardano holders to stake their ADA for any duration and quantity in exchange for MELD tokens. The first stake pool was filled within 24 hours after roughly $100 million worth of ADA was contributed. Within five days, four stake pools equivalent to nearly $200 million were filled.

MELD stopped accepting new delegations on Oct. 27. By that time, nearly 620 million ADA had been staked for a cumulative value of over $1 billion. All said, the ISPO had over 40,000 participants. MELD also raked in $10 million in revenue.

The ISPO was a significant departure from previous crypto funding initiatives, most notably the initial coin offering (ICO) and security token offering (STO), and was a nod to Cardano’s growing ecosystem. It also highlighted pent-up demand in the market for DeFi projects, which continue to pique investors’ interest.

Blockchain projects raised billions of dollars in funding in 2017 and 2018 before regulatory crackdowns and a brutal crypto bear market put an end to the mania. Source: 3TS Capital

Why Cardano?

Of all the proof-of-stake (PoS) chains in existence, MELD selected Cardano for its ISPO for its lower transaction costs, attractive staking mechanism and overall architecture, according to CEO Ken Olling. During MELD’s initial development phase in mid-2020, Cardano was perceived to be the best option considering the circumstances surrounding Ethereum (ETH) at the time.

“There aren’t any more established blockchains,” Olling told Cointelegraph, adding:

“One of our requirements was a modern PoS blockchain. The only real option at the time was Cardano. You have Solana, which has a two-tiered, much more complex staking mechanic in regards to the blockchain. It also operates legally in a different way. And then you have other PoS blockchains, but none of them really provided the full picture or the full package.”

Related: How Solana and Cardano are paving new avenues for NFT growth

Olling said his firm is still “very bullish” about Cardano’s future despite its recent struggles. ADA's performance has lagged considerably in recent months after being one of the crypto market's hottest performers through September.

Achieving financial efficiency

At its core, MELD offers non-custodial banking services, enabling users to lend and borrow with both crypto and fiat currencies as well as stake their MELD tokens for interest. Lenders can deposit both cryptocurrency and fiat currency on the platform. Borrowers have the ability to borrow in both types of assets after posting their crypto as collateral. 

The crypto collateral option is attractive for investors because it means they can borrow fiat to meet their expenses without having to sell their digital assets and thus incur a capital gains penalty. (Capital gains taxes are a source of consternation for cryptocurrency investors, with large bag holders always looking for ways to use their newfound wealth in the most efficient way possible.)

When asked about what differentiates MELD from other crypto lending and borrowing platforms, Olling identified two factors: first, “on the highest level, we offer transparency,” he said. “It’s on the blockchain, so what happens with funds on the protocol is completely open-sourced, unlike centralized crypto lending and borrowing services.”

Secondly, and on a more practical level, MELD offers “users fiat currencies for their crypto-backed loans, whereas other [...] DeFi competitors can only offer other cryptocurrencies.”

Related: DeFi can be 100 times larger than today in 5 years

Cryptocurrency lending has emerged as one of the biggest use cases within DeFi, with the likes of Aave and Compound achieving over $14 billion and $11 billion in total value locked (TVL), respectively. More than two-dozen other protocols have achieved a TVL of at least $100 million, according to industry data. 

Although the emergence of DeFi has presented a sort of threat to the traditional financial system, the industry's growth has been largely driven by users who already have access to legacy banking systems. That appears to be slowly changing as crypto entrepreneurs target the globe's vast unbanked and underbanked populations in pursuit of financial inclusion. According to Olling, financial inclusion is a by-product of a more efficient financial system that is made possible through DeFi. 

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

Illuvium, LCX and Tokemak hit new highs as Bitcoin dominance lingers

LCX, ILV, TOKE and at least 10 other altcoins hit new all-time highs alongside ETH today.

During bull markets, altcoins tend to accrue gains when Bitcoin price consolidates and at they run in tandem with BTC price during breakouts. This dynamic appears to be at play today because multiple altcoins went parabolic at the same time that BTC made a run at $64,000 and Ether (ETH) hit a new all-time high above $4,500.

According to data from Messari, 31 tokens have established new record-highs in the past 24-hours and the total cryptocurrency market cap increased from $2.619 trillion to $2.732 trillion overnight.

Top 13 tokens to recently establish a new all-time high. Source: Messari

Let's take a closer look at the motivating factors behind the rallies in LCX (LCX), Illuvium (ILV) and Tokemak (TOKE).

LCX benefits from new exchange listings

LCX is the native token of the Liechtenstein Cryptoassets Exchange which was established in 2018. Currently, the exchange is in possession of at least 8 cryptocurrency-related registrations by the Financial Market Authority Liechtenstein and this allows the platform to legally offer exchange services and security token offerings (STO).

Data from CoinGecko shows that since hitting a low of $0.125 on Oct. 17, the price of LCX has rallied 250% to a daily high at $0.44 on Nov. 2 as its 24-hour trading volume spiked 257% to $18.3 million.

LXC/USD 2-hour chart. Source: CoinGecko

The sudden spike in price and trading volume comes a day after LCX token was listed on Coinbase Pro and the Singapore-based Bitrue exchange.

Illuvium gameplay preview send ILV price higher

Illuvium is an open-world fantasy battle game that is built on the Ethereum newtork and has the goal of becoming the first AAA-rated blockchain-based game that incorporates aspects of decentralized finance (DeFi) and nonfungible tokens (NFT).

Data from TradingView shows that after reaching a low of $452.9 on Sept. 29, the price of ILV has surged 171% to establish a new record high at $1,231 on Nov. 2 as its 24-hour trading volume jumped 122% to $105 million.

ILV/USD 4-hour chart. Source: TradingView

The building momentum for ILV comes following the release of raw footage depicting the gameplay of the platform. This gave interested gamers their first taste of the Illuvium ecosystem.

Related: Axie Infinity, Decentraland and ‘metaverse’ cryptos rally after Facebook rebrands to Meta

Tokemak incorporates ‘Token Reactors’

Tokemak is a decentralized liquidity and market-making protocol that supports an "efficient and sustainable liquidity" across the DeFi ecosystem.

Data from CoinGecko shows that since trading at a low of $29.98 on Sept. 21, the price of TOKE has increased 145.65% to reach a new record high at $73.27 on Nov. 2 as its 24-hour trading activity remained relatively stable near $8 million.

TOKE/USD 2-hour chart. Source: CoinGecko

The steady climb in the price of TOKE comes as the total value locked on the Tokemak platform reached a new all-time high of $767.9 million according to data from Defi Llama. The recent rollout of “Token Reactors” on the Tokemak dashboard allow users to stake tokens from other protocols such as Alchemix (ALCX) and Olympus (OHM) to earn TOKE rewards.

The overall cryptocurrency market cap now stands at $2.732 trillion and Bitcoin’s dominance rate is 43.8%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

Blockstream raises $16M for its Bitcoin mining STO in a matter of hours

Blockstream allows investors to mine Bitcoin by simply purchasing the Blockstream Mining Note security token.

Major blockchain technology company Blockstream has completed six tranches of its Bitcoin (BTC) mining security token offering (STO), securing a total of 30.9 million euros ($36 million).

Blockstream officially announced Thursday that the company raised 13.9 million euros ($16.1 million) in the sixth tranche of its Bitcoin mining-focused security token known as Blockstream Mining Note (BMN).

According to the announcement, the latest raise was the largest tranche that Blockstream has ever issued, marking increasing interest from individual and institutional investors. The raise brings the total BMN supply to more than 122, with the total number of investors amounting to 70.

Blockstream officially introduced its BMN security token in March 2021, offering non-US qualified investors an alternative to mining Bitcoin or investing in Bitcoin mining stocks by mining BTC using the associated hashrate of BMN. Issued on the Liquid sidechain of Bitcoin, each BMN1 entitles investors to up to 2,000 terahashes per second of Bitcoin mined at Blockstream’s enterprise-grade mining facilities.

The BMN token can be traded with other qualified investors, delivering associated BTC to the BMN holder upon maturity of a three-year term from July 2021 to July 2024.

Related: Bitcoin-based security token offering approved in Germany

The news comes amid Blockstream preparing to list its BMN security token on Bitfinex Securities, a new STO platform by Bitfinex cryptocurrency exchange and regulated in Kazakhstan’s national financial hub, the Astana International Financial Center. As Bitfinex Securities progresses with its launch, BMN is set to become one of the first assets listed on the new platform.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

Bitcoin-based security token offering approved in Germany

Germany joins countries such as France, Luxembourg, Spain and Portugal by greenlighting the Bitcoin-based EXOeu token.

German financial regulators have approved a security token offering (STO) based on a Bitcoin (BTC) sidechain.

Germany’s Federal Financial Supervisory Authority (BaFin) has greenlighted the EXOeu token by game publisher Exordium, making local retail investors eligible to participate in the sale on Stokr, a major European digital marketplace.

German investors can invest in EXOeu via Stokr with a minimum investment amount of $100. EXOeu is the second STO ever approved for the German market on Stokr after BaFin approved an STO by parking network ParkinGO last year.

Launched in January 2021, the EXOeu security token is raising funds for the development of Samson Mow’s sci-fi MMO game Infinite Fleet. The offering has been available for investors in other European countries lik France, Luxembourg, Spain, Portugal, raising more than $7 million to date.

While many STOs are based on the Ethereum blockchain, the EXOeu token is issued via Blockstream Amp, a platform for tokenizing securities built on the Liquid sidechain of Bitcoin.

“Bitcoin is shaping payments, and it’s about time it shaped capital markets — this can be done via layer two technologies,” Stokr co-founder Arnab Naskar said, adding that Ethereum is “losing its charm” as an STO platform due to high gas fees and the uncertainty around Ethereum 2.0.

Related: Bitfinex launches security token platform regulated in Kazakhstan

According to Stokr co-founder Tobias Seidl, BaFin’s approval of Exordium’s STO marks a new milestone in cross-border blockchain-based STOs. “We see Bitcoin as a fundamental backbone of the future capital markets, which will be built on blockchains,” he said.

The news comes shortly after major crypto exchange Bitfinex announced last week that it would debut its own STO trading platform with Exordium (EXO) trading.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

Bitfinex launches security token platform regulated in Kazakhstan

Bitfinex’s new security token platform will provide exposure to blockchain-based equities, bonds, and investment funds.

Hong Kong-based cryptocurrency exchange Bitfinex is moving into the security token offering (STO) industry by launching a new STO platform regulated in Kazakhstan.

Bitfinex Securities, Bitfinex’s blockchain-based investment product provider, has launched its investment exchange regulated in Kazakhstan’s national financial hub, the Astana International Financial Center (AIFC), the firm officially announced on Sept. 6.

The new STO platform will reportedly operate under the AIFC Fintech Lab, a regulatory sandbox established in the AIFC by the Astana Financial Services Authority (AFSA) to support development in the financial industry.

Located in Astana, Bitfinex Securities will be available 24/7, providing investors with more ways to diversify their portfolios by raising capital for issuers seeking to trade their tokenized securities publicly. “This meaningful step for the industry will widen access to a variety of innovative financial products, including notably blockchain-based equities and bonds, along with investment funds,” Bitfinex said in the announcement.

Bitfinex Securities’ chief technology officer Paolo Ardoino said that the new platform aims to provide the “most liquid exchange of its kind in the world.” “Bitfinex Securities provides a regulated platform serving small and medium-cap companies that are currently underserved by existing, inefficient capital markets,” he added.

According to a legal statement, Bitfinex Securities has an extensive list of jurisdictions and persons prohibited from trading on the platform. Prohibited persons include individuals in the United States, citizens or residents of Canada, Switzerland, the British Virgin Islands, Venezuela, Austria, and Italy. Prohibited jurisdictions include any jurisdiction subject to a comprehensive embargo by Kazakhstan, the United States, British Virgin Islands or the United Nations, including Iran, Cuba, the Crimea region, and others.

Bitfinex did not immediately respond to Cointelegraph’s request for comment.

Related: Kazakhstan to reportedly allow banks to process crypto purchases

Kazakhstan has recently been drawing increased attention from the global cryptocurrency community as some of the world’s largest crypto mining companies have been working with local entities to run mining facilities and services in the country. During a crypto mining crackdown in China, crypto mining giants like Canaan relocated operations and launched new businesses in Kazakhstan in June.

Earlier this year, Kazakhstan’s government was working on a roadmap to support the local crypto industry development, planning to improve the country’s crypto regulations and strengthen the country’s position in the global crypto market.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

How to launch an STO? Report predicts market to reach $3B valuation by 2025

Launching tokenized securities could be easier than one would expect. There are four main steps to make it happen, but it may take some time.

Security tokens may be poised for exponential growth as security tokenization industry players reveal optimistic forecasts based on surging demand. With that, the market size by 2025 could reach the $3 billion mark, according to the area2invest report, a security token marketplace. The study by the Liechtenstein-based security token marketplace also suggests a market compound annual growth rate (CAGR) of 56.9%. 

As Bernhard Thalhammer, head of issuer relations at area2invest, told Cointelegraph: “Every day, we receive several requests, not only from blockchain or crypto companies but also from more traditional businesses which have very concrete STO projects in mind.” He added: “We are actually quite surprised how well informed they are and how far they are in their decision-making process.”

Major institutions have already uncovered their security tokenization experiments, with recent examples include European Investment Bank, Thailand’s Central Bank, and the Union Bank of Philippines in collaboration with Standard Chartered Ventures.

This May, crypto exchange INX held the first security token offering (STO) registered with the United States Securities and Exchange Commission (SEC), with over $125 million in proceeds from the fundraising.

Despite STOs being more popular among companies across the blockchain industry, growth opportunities for the security token market may rely on businesses from traditional sectors, which have less experience with tokenization technology.

Eventually, security tokenization could upend the traditional stock and bond issuance model, but the knowledge gap puts the brakes on the STOs market growth in addition to the regulatory hurdles. However, the security token issuance process is more straightforward than one would expect. It can be broken down into four steps, according to the area2invest report. The preparation for the token sale could take up to 18 to 24 weeks, followed by an investment period of 15 to 52 weeks.

Idea generation

The report suggests that the very first phase of an STO boils down to designing the ideal model of a security token offering and drafting the plan on how to bring the token to the market. At this stage, a potential issuer has to answer some questions about the investment idea, including the specifics of the oncoming investment product, the type of investor the product is aimed at and the target funding volume.

Recent STOs show that the digitization of the capital-raising process gives companies flexibility in terms of the type of securities they would like to issue and the kind of investors being targeted. In April 2021, for example, the Exodus wallet completed an SEC-approved STO, offering its shares to both professional and retail investors through its wallet. The issuer can also opt for another combination. This May, the Singapore-based DBS Bank issued an $11.3 million digital bond, available for professional investors only.

Companies starting the security token offering journey also have to consider their marketing and distribution strategies, the entity that would be carrying out an STO, market sentiment analysis and the regulatory framework.

Drilling down into the aspects of the oncoming STO, the issuer has to eventually define the project budget — how much would it actually cost to hold an STO? Is the issuance justified by the numbers? “As with any issuance, there are initial fixed costs, which is also the case with STO, e.g. the prospectus. In addition, there are costs associated with the funding volume,” added Thalhammer.

Structuring an STO

With the plan of the security token offering in place, the issuer should have a more nuanced conversation about the financial aspects of the upcoming STO. The token price should reflect the real valuation of the company, so the issuer should consider a corporate financial advisery to confirm that the soft and hard caps match with the fundamentals.

Another question floating to the surface in the second phase is the rights and obligations the potential investors obtain, and how security tokens as a product should be structured to protect all of the STO participants.

One crucial task is to identify the most attractive jurisdiction for the issuance and ensure that the token offering is compliant with the country’s regulation in every requirement, including taxes. To scope out the most efficient routes to solve any legal issues, hiring a legal adviser is strongly recommended, according to the report.

Based on the information above, the issuer should prepare product documentation, which can be presented in the form of a securities prospectus or an investment memorandum, and be distributed across the potential investor base.

The digitization of securities requires issuers to take notice of the technical side of an STO. Smart contract programming is a key element in this, but it is also important to ensure the safekeeping of the tokens. This requires partnering with market participants that are specialized in asset tokenization and custodians so that the STO execution would go according to plan.

The main criteria to consider is the track record of the tokenization company, as well as the fact that the interfaces and the information exchange are well integrated into the STO ecosystem. A tokenization partner should suggest the right blockchain.

Listing and distribution

In the third phase, the issuer has to bring the tokens to market, and the report identifies five steps. Before the tokens are created, final preparations need to be made. The token model has to be reviewed by an external source, usually a broker, and the marketing campaign of the token to be carried out.

Then, the security token of the company is minted, and the investors that qualify through the Know-Your Customers (KYC) and Anti-Money-Laundering (AML) requirements get access to the token sale. After the purchase is completed, the tokenized securities are delivered to investors' wallets. Despite the simplicity of this process, the token sale could take up to 52 weeks depending on the level of demand from the investors.

Asset servicing

Post-issuance support, which includes plenty of administrative actions, is an integral part of an STO, although it often remains in the shadows of token sales. As full-fledged security, tokens need to be serviced properly. This implies building the reporting standards for the tokenized assets and organizing investor relations.

A sustainable token-based model should also comprise user-friendly systems for paying coupons or dividends, depending on the type of security, and a vehicle for investors to vote on corporate actions.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

Singapore’s DBS Bank launches digital bond security token

Institutional or accredited investors signed up to the DBS Digital Exchange will be able to access secondary markets for DBS’s digital bond.

Singapore-based multinational banking corporation, DBS Bank, has launched its first-ever security token offering, or STO, by issuing a digital bond.

The DBS digital bond has been priced at $11.35 million and comes with a six-month tenor and coupon rate of 0.60% annually. The offering was carried out through a private placement hosted by DBS Digital Exchange, or DDEx, marking DDEx’s first STO.

To encourage investor engagement, the bond is set to be traded in board lots of 10,000 Singapore dollars (roughly $7,560) — a dramatic reduction compared to the 250,000 Singapore dollar board lots that traditional wholesale bonds are traded in.

The digital bonds will be available for secondary trading to clients of DDEx who are accredited or institutional investors.

DBS hopes its offering will pave the way for other issuers to launch security token offerings via the DDEx platform.

Eng-Kwok Seat Moey, the Group Head of capital markets at DBS, emphasized that security tokens offer an efficient and innovative method for raising capital in the Asia-Pacific region — which currency represents more than 30% of the global private equity markets. He stated:

“Our maiden STO listing on the DBS Digital Exchange is a significant milestone, as it highlights the strength of our digital asset ecosystem in facilitating new ways of unlocking value for issuers and investors. We expect asset tokenisation to increasingly become more mainstream as more of our clients start to embrace security token issuance as part of their capital fund raising.”

Since launching in December 2020, Moey estimates daily volumes on DDEx have increased by 900%, with the platform now servicing more than 120 traders. DBS’s crypto custody service also holds more than $60 million in assets.

The bank also launched a trust structure offering investment management services for Bitcoin (BTC), Ether (ETH), XRP, and Bitcoin Cash (BCH) speculators in early May.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud

Adam Back unveils Blockstream’s new Bitcoin mining security token

Blockstream has announced the launch of a new security token backed by the company's mining facilities.

Canadian-based Blockchain tech company Blockstream announced the launch of a security token backed by the company's mining production on March 29.

It offers an alternative to investing in Bitcoin mining stocks, with the company providing non-US qualified investors exposure to Bitcoin mining through the Blockstream Mining Note security token. BMN represents 2,000 terahash per second of hashrate from Blockstream's  mining facilities.

The Bitcoin mined for BMN will be held in cold storage for three years, and will be distributed to the final token holders at the end of that time frame.

Blockstream plans to begin BMN mining operations by July 9, with the following tranches expected to be released in the third quarter of this year.

The BMN security token offering, or STO, will be held on STOKR, a European investment marketplace for alternative digital assets. The first tranche of security tokens will be on offer from April 7, and are priced at roughly $240,000 each, which is also the minimum investment.

In the announcement published on Blockstream’s website, CEO Adam Back and CIO Chris Cook emphasized the benefits of gaining exposure to the security token in comparison to investing in mining infrastructure:

“By packaging mining in a tradable token, the BMN allows investors more flexibility than a traditional investment in physical mining infrastructure—investors can more easily adjust their exposure to Bitcoin mining by trading the BMN on secondary markets.”

“By expanding investor participation in Bitcoin’s proof-of-work, the BMN also strengthens Bitcoin’s security and censorship resistance. It’s a win-win for investors and the broader network,” the post said.

Exposure to Bitcoin mining has been a lucrative option for many investors. Cointelegraph reported on March 22, that shares in the top four publicly traded mining firms were up 5000% in the last 12 months, compared to the 900% growth of Bitcoin in that same period.

French Authorities Raid 5 Major Banks Over Accusations of Money Laundering and Fiscal Fraud