Satang Corporation, a Thai-based cryptocurrency exchange, has announced plans to launch a Security Token Offering in early 2019. With the support of the Thai government, they aim to receive US regulatory approval to raise nearly $10 million to expand their current operations.
Details of Cryptocurrency Exchange Satang Pro’s Security Token Offering
Satang Pro is a Thai-based cryptocurrency exchange which has had a 24-hour trading volume of around 1 million USDT throughout early December 2018.
They will now look to raise $9.9 million through a Security Token Offering (STO) in Q1 of 2019. Satang plans to register their STO with the United States’ Securities and Exchange Commission (SEC), thereby allowing US-based investors to legally participate in the offering. Future plans involve the listing of Satang’s security token on US-based security token exchange tZERO.
Despite regulatory ambiguity when it comes to security tokens in Thailand, the Thai government has also announced support for the upcoming STO.
Security tokens seem to be the latest implementation of Distributed Ledger Technology (DLT). As opposed to the regulatory ambiguous Initial Coin Offering (ICO), compliant security tokens adhere to existing securities laws, as established by the applicable regulatory bodies. In the US, for example, that governing authority is the SEC.
Due to the clearer regulatory guidelines for STOs in many popular jurisdictions, several companies are cancelling ICOs and turning to the STO as a viable alternative.
How Satang will Use the Funds Generated from their STO
Satang intends to put the funds raised through their STO into the development of a Satang App e-wallet. The digital wallet will enable consumers to make various payments in cryptocurrencies.
Satang also plans to establish its own brick-and-mortar shops in tourist hot spots such as Phuket and Pattaya.
The Benefits of Security Tokens Explained
Security tokens allow for companies to maintain private status while raising funds in a much more streamlined process when compared to traditional finance.
The ownership of real-world assets becomes tokenized, and those tokens have increased liquidity since they can be traded on security token exchanges, or Alternative Trading Systems (ATSs). Such platforms operate 24/7/365, which is quite distinct from traditional financial exchange platforms.
Security tokens also decrease investor barriers through fractionalized ownership. For example, the need to find one investor with $5 million can be reduced to the much more feasible need to find 50 investors with $100,000. For more on the benefits of security tokens, be sure to review our comprehensive security token guide.
Many real-world assets have already experienced the advantages of tokenization: luxury property, REITs, investment funds, equity, and fine art.
Despite Bitcoin’s plunge throughout 2018, security tokens have witnessed a different pattern.
What do you think about Satang’s STO? Will more companies conduct STOs as a compliant means to raise funds? Let us know what you think in the comments below.
Image courtesy of Unsplash.