NASDAQ released that it is the process of creating safe alternative to the scam riddled initial coin offerings (ICOs) plaguing the industry. The platform will allow companies to enact sales of security tokens similar to an ICO. This new platform may prove to be a saving grace for startups looking for funds, while multiple countries are cracking down on fraudulent ICOs.
NASDAQ’s no stranger to the blockchain technology as they conducted the first-ever blockchain-based private securities issuance back in 2015. Currently, NASDAQ has looked to partners such as Symbiont, blockchain startup focusing on institutional blockchain solutions, for developing the platform. The platform will assumedly be multi-purpose as it will issues tokens as well as performing as a trading platform for the security tokens.
As NASDAQ carves a path into trading security tokens and will most likely make waves as the already have excellent performing participants like Polymath, a company that connects token investors and smart contract developers who help form the basis of securities tokens, and tZero, a company whose goal is to make securities lending activities of our licensees compliant, more transparent, and more efficient .
Due to security tokens not being the same as utility tokens, because they are a digital representation of a tangle asset, this isolates them from regulations placed on utility tokens.
NASDAQ moving towards providing an alternative which is secure and well regulated, may be the lifeline startups need to raise funds amidst the scam ICOs.