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Toggle navigation Opportunity Our Users Problems Solution Our Process Privacy Policy Contact Terms of UseSmart Compliant Tokens The ERC-20 token & similar technologies can not provide a truly compliant solution to the tokenization of securities, nor deliver a compliant token offering. But we can . TOKEN RECOVERY KYC COMPLIANCE MARKET MAKING TOKEN RECOVERY KYC COMPLIANCE MARKET MAKING TH OPPORTUN I TY We at believe that the benefits of a cryptomarket are much deeper and richer than just skirting regulation and staying in the shadows. In fact, by bringing crypto currencies into the bright light of government regulation, taxation and compliance, those advantages become easier to express. It is simpler and less expensive for entrepreneurs to raise capital and for well-established corporations to finance big, complex projects using tokenized securities. We’re here to help. Our potent i al us rs ENTERPRISES / PUBLICLY TRADED COMPANIES Reduced execution time and transaction costs to finance sizable and complex projects. STARTUPS Reduced cost to raise capital, by providing a turn-key solution for tokenization, compliance and investor management. INVESTORS White glove solution for Investor’s reporting and wealth monitoring needs, token recovery. FINANCIAL INSTITUTIONS & BANKS Allowing financial institutions to become gateways for their customers into fully compliant tokenized offerings. Key PROBL Ms We Address Key Issues with Tokenized Securities Today Despite the tremendous surge of activity and its popularity, the STO ecosystem is still largely ineffective. COMPLIANCE WITH SECURITIES LAWS Currently, many tokens sold through token fundraising do not comply with legal frameworks such as investor qualification rules, holding periods, transaction limits and transfers. There is a huge misalignment between securities laws and tokens operations. CROSS BORDER ISSUES Issuers currently simply don’t permit the direct purchase of tokens from territories deemed as problematic such as the USA and China. Thus, issuers are unable to control the post-release trading of their tokens and they are leaving a great deal of value and liquidity on the table. TOKEN PRICE VOLATILITY With a thinly traded pool it seems inevitable that tokens, if allowed to trade completely freely without regard for market dynamics and price support mechanisms will not meet founder’s expectations nor investor’s long-term goals despite their initial run-ups in valuation. POST OFFERING TRANSPARENCY One of the core values propositions of blockchain based solutions is the increased transparency they should bring to the transaction pace. Unfortunately, the ICO/ITO market is exhibiting precisely the opposite tendency. enables on-chain trading thus maximizing transparency and market efficiency. HIGH TRANSACTIONAL COSTS AND SCALABILITY ISSUES With increasing popularity of blockchain technology and use of Ethereum network as a go-to solution for issuing new tokens the cost of processing each transaction becomes costly, bears high friction and presents disabling lack of infrastructure scalability. COMPLIANCE WITH ICO/ITO REGULATIONS The regulation of tokens is a rapidly evolving area of government scrutiny. Investors that may qualify today may be proscribed tomorrow. Geographies that are challenging one day may be beneficial the next. ’s unique approach to enabling issuers to manage their offerings allows unparalleled flexibility no matter how the environment changes. TH SOLUT I ON LEGAL TRANSFER OF OWNERSHIP ACHIEVING COMPLIANCE MARKET MAKING & FINANCIAL TOOLS WALLET LOCKOUT – TOKEN RECOVERY INCREASED TRANSPARENCY KYC TOKEN (KNOW YOUR CUSTOMER) IN-TOKEN REPORTING CAPABILITIES LEGAL TRANSFER OF OWNERSHIP Not all appropriate and legal transfers of shares can or will be facilitated by the wallet holder. As a corporation, an issuer must be able to satisfy legal and regulatory requirements and orders without relying on the holder of a wallet to necessarily cooperate in the transfer. Some examples of such circumstances include: INHERITANCE COURT JUDGEMENTS CUSTODIANSHIP makes it possible for issuers to comply with lawful orders for the transfer of their assets. ACHIEVING COMPLIANCE Once issuers embrace the notion that tokens are securities, the toolbox available to all issuers around the world becomes available to them. There are those who assert that as start-ups ICO/ITO issuers should not be subject to the rigor and discipline that mandated compliance demands of compliant entities, but it is our opinion and assertion that like any other company, a start-up that successfully raises $10- or $20- or $100 million dollars is not really a startup in the usual sense of the word, and should, in fact, be held to the same standards as other companies of similar size. The early exuberance of newly minted crypto millionaires, combined with a dearth of places to spend their almost lottery-like earnings created a momentary thirst for such investments” but it is clear that this exuberance has run its course. MARKET MAKING & FINANCIAL TOOLS Since technology makes it possible to govern the transfer of tokens based on various criteria, the existence of a time-based prohibition on transfer, or the limitations of such transfer in response to some transactions such as the one implied by various forms of market making becomes just another of the set of criteria which are examined before any token transfer is permitted. Some market making mechanisms enabled by technology are: FUTURES OPTIONS (AMERICAN AND EUROPEAN) SWAPS VESTING EARN OUTS ESCROW WALLET LOCKOUT – TOKEN RECOVERY Wallet Lockout” is a key issue that faces all current cryptocurrencies. Investors keep their tokens in digital wallets that are really simply an address on the blockchain. While this caveat emptor reality may be okay for cryptocurrency it is not compatible with the expectations of shareholders or the legal requirements facing real companies. In the real world, if someone buys shares and then loses their certificate, they have not, in fact, lost their legal entitlement to those shares. In most cases such a shareholder would sign an affidavit stating that the share certificate was lost and the company would reissue those shares to the shareholder. empowers issuers to be able to reissue tokens to shareholders, subject to appropriate checks and balances. INCREASED TRANSPARENCY One of the core value propositions of blockchain based solutions is the increased transparency they should bring to the transaction space. Unfortunately, the ICO industry is exhibiting precisely the opposite tendency. The approach allows a company’s investors to get information about the issuer on a fully diluted basis, that is to say with full visibility on all the tokens that have been given, promised or otherwise encumbered. INDEXES By permitting transactions like futures to be exercised directly on the blockchain, the technology also allows for the generation of market indexes for based assets since all transactions – including conditional ones – are fully visible. This is in contrast to Token transactions today that occur on small, unregulated exchanges and therefore do not have good visibility and create a significant information distortion for traders. KYC TOKEN (KNOW YOUR CUSTOMER) As has been anticipated for some time, the SEC released a statement asserting that ITOs are subject to the same test and compliance requirements under US Securities Law.* By creating a KYC Token that acts to regulate the transfer of the issuer tokens themselves, we can minimize the cost and overhead of the KYC process for Issuers. A Token that requires an appropriate KYC Token to already be present in the receiving wallet would preclude the Token from being transferred or sold to a person who is not eligible to hold it. This creates a much higher threshold of compliance enforcement and reduces risk for the Issuer. Using TokenIQ’s KYC token assures full compliance not only during the initial offering period...