Blockchain technology is quickly becoming a fact of life. From Bitcoin trading to governments exploring digital currencies, decentralized solutions are more popular than ever. One use case for decentralized ledger technologies is the tokenization of assets. Tokenizing stocks, bonds, or property allows their trading to be done more easily and quickly. Anything can be tokenized, from currency to art to mortgages. When applied to traditional finance, several intriguing concepts can be explored, with LCX leading the way.
How Does this Help?
The legacy banking system has several inherent flaws in terms of raising capital. Long waiting times, hefty fees, and red tape cause delays that are, at today’s pace, are unacceptable. One way to speed up this process is to tokenize receivable assets or debt owed to a company. The creation of these new assets is known as Security Token Offerings, or STO’s. These tokenized receivables are redeemable for working capital from participating financial institutions.
Other uses for STO’s are in commercial property sales. In real estate, converting a building to tokens allows the tokens to be sold to investors, representing an ownership share in the property. This fractional ownership not only opens up investing to smaller investors but increases transparency as the assets are verifiably stored on the blockchain.
As we have previously explored, LCX is a multi-faceted blockchain company that aims to comply with all local Liechtenstein cryptocurrency laws. Its goal is to be “one of the world’s first licensed and supervised security token exchanges as a regulated marketplace for digital assets.” The company is pioneering the world of STO’s and has insights into accomplishing this in a competitive marketplace.
Creating an STO
In a decentralized world, companies need to go the extra mile to provide potential investors with the information and security they need to succeed. Creating a working product, and complying with all applicable rules and regulations are massive undertakings, worthy of a separate article. Also recommended is a large amount of marketing material.
An attractive website, competent Whitepaper, active community channels, and partnerships are essential in bringing a project to the public. In the age of social media, interacting with potential/current investors is a significant undertaking. Telegram is the most popular channel for official communications currently.
Active community members will be the strongest supporters of a project but are often the greatest critics. Several projects have devoted community channels that create their material and articles.
LCX in the Industry
For parties interested in creating an STO or exploring their options, LCX has an STO Launchpad. This service allows users to work with the LCX team to create a custom token offering to serve users and investors best.
*Disclaimer – LCX is our Media Partner, and therefore this content is sponsored by them.
