On December 26th, 2019, digital asset exchange Blockquake announced the successful launch of its Beta platform. Blockquake places significant emphasis on regulatory compliance and currently has an open Reg S token sale while awaiting the SEC’s approval for a Reg D Rule 506(c) offering.
Blockquake’s Beta Launch Explained
Blockquake is a developing digital asset exchange with a sharp focus on regulatory compliance. The exchange refers to itself as “a regulatory conscious project”.
According to the company’s CEO and co-founder, Antonio Brasse, Blockquake has successfully launched its Beta platform. Live production, to include the trading of BTC, ETH, LTC, USD, CAD, JPY, has begun.
The news was released in a tweet from Blockquake’s CEO himself. On December 26th, Brasse tweeted,
Merry Christmas, Happy Hanukkah & Happy Holidays All […] we in #beta bitches!!!! […] live production testing has begun on the #exchange. $BTC $XRP $LTC $ETH $CAD $JPY $USD & many more is or will be part of our testing.
Brasse brings experience from traditional finance to the realm of digital assets. Previously, he worked as the Vice President of Citi where he was responsible for global audits as well as data governance, quality, and privacy. He also worked as an audit manager at AIG.
He has been outspoken with his view of the existing security token ecosystem — at least in regard to its shortcomings. The biggest, he says, is regulatory compliance. This also happens to be an area where, thanks to his experience, he believes Blockquake will succeed.
Blockquake is currently seeking a Reg D 506(c) offering from the U.S. Securities and Exchange Commission (SEC). If approved, the sale would offer its native token, QUAKE.
Blockquake CEO on the Dangers of ‘STO Exchanges’
Previously, Brasse has taken to twitter regarding his stance on so-called ‘STO-Exchanges’. In a five-part tweet, Brasse went on to describe how STO-Exchanges are something along the lines of an oxymoron.
“1) A word on STO exchanges – if anyone refers to themselves as such, run away. It’s a gimmick to take your money. STOs deal in the primary markets & exchanges are for secondary trading. They are distinctly different. Run away from IEOs.
2) If anyone is dealing with clear tokenized securities at the retail level, whether at issuance or secondary markets, know that they need to be under clear regulatory framework for investor protection. I haven’t met one “STO exchange” that fits that, but many claim to.
3) Beware of so-called STO exchanges that claim they need to only be licensed in one or two jurisdictions, usually, they’ll mention shady ones. Unless another country gives you reciprocity, you can’t do business with their citizens until you are licensed with them also.
4) We’re unfortunately going to see a lot of these so-called STO exchanges operating with no legal protections/transparency in place for the customer & the customer/project will all lose money. Just run away from anything with the “STO exchange” or “IEO” label & spare yourselves.
5) Bottom line, if any exchange has security tokens or tokenized securities (in the true legal sense) trading, they should also have a globally recognized audit firm. If they don’t, run away from them.”
On the regulatory front, Blockquake is pursuing several licenses. It is currently seeking a broker-dealer license, which would allow it to buy and sell financial securities — including regulated security tokens — on behalf of others. It is also seeking registrations with the Commodity Futures Trading Commission (CFTC) and a BitLicense from the state of New York.
Ultimately, Blockquake is pursuing regulatory approval to operate as an Alternative Trading System (ATS). An ATS is a trading venue which matches the buy and sell orders for transactions, yet is regulated as a broker-dealer as opposed to an exchange. So far, the digital asset industry has two well-known ATSs which actively match orders for digital assets — OpenFinance Network and tZERO.
What do you think about Blockquake launching its Beta platform? We’d like to know what you think in the comments section below.
Image courtesy of YouTube.