- What's Drippin'
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- 👔❌ **** the suits
Security Token Market is tokenizing! After week 3 of the Test The Waters campaign, we have received $2.5M+ in pledges from 400+ investors from 20 different countries and 6 continents!
🇪🇸🇯🇵🇺🇸🇰🇷🇨🇦🇦🇺🇵🇭🇨🇳🇵🇱🇦🇹🇷🇼🇬🇧🇻🇪🇰🇪🇦🇪🇳🇬🇫🇷🇧🇷
Gooood morning, Rainmakers!
As always, I have two captivating topics for you to dive into:
1️⃣ Fu$& the suits... but for real this time: The WSB subreddit co-founder is creating investment products that give the power back to the investor!
2️⃣ The first cross-chain security token - Mt.Pelerin: Now you can own the Mt. Pelerin token on multiple protocols! Should more tokenized assets do this?
Without further ado, it's time to…
Get liquid 💧
👔❌ Fu$& the suits... but for real this time
Earlier this year, the US financial industry was in a complete state of pandemonium.
On one side you had the WallStreetBets (WSB) subreddit community powering insane rises in stock prices, with the sole mission to restore order and power in the financial system by taking down the big institutions.
On the other side, you had brokers like Robinhood who literally restricted its users on whether they can buy or sell specific securities!
This caused a massive uproar across the retail investing demographic.
The reality is our financial industry has a lot of limitations and inefficiencies that we saw come to light.
Inefficiencies:
Clearing and settlement: Requires a middleman and takes at least 2 business days
Restricted trading hours & days: The US market is open only 253 days a year
The WSB community may have slowed down a bit when it comes to short squeezing 'the suits,' but they have been working on something that is going to transform the capital markets by solving the inefficiencies with blockchain-based solutions!
Solutions:
Decentralization: No middleman required and instant-settlement
No restrictions: The market operates 24/7 365
Enter The WSB YOLO Stonks ETP:
A blockchain-based investment product for the everyday investor available to any retail investor in the world.
To be clear, according to their website, this is going to be a tokenized ETP-like investment product.
An ETP is an Exchange-traded portfolio that will be tracking the price of several US publicly traded securities - similar to an ETF.
The stocks in this ETP (or stonks as WSB describes them) will consist of $GME, $AMC, $BB, $NOK, and more stonks that were amongst the most actively traded during the WSB saga earlier this year.
This is too perfect!
This means that all retail traders of any WSB fund product will be able to trade at will at any point of time throughout the year, without any 'suit' getting in the way of the same assets that were controlled and restricted once before!
This is the true value proposition of security tokens at work!
No longer are you required to have a certain financial status or connections to access cutting-edge investment funds.
Now that you understand the disruption and product, let's look at the players working to make this possible:
Bitcoin (Layer 1 - Network): The most secure network in the world
Liquid Network (Layer 2 - Securities issuance and registry): The blockchain platform that is being used for issuance of the investment products, as well as for ownership registry
MERJ Exchange (Layer 3 - Exchange and market infrastructure): Globally recognized & licensed exchange with security token secondary trading capabilities
Digital Markets (Layer 4 - Issuer and investor interfaces): Facilitating all aspects of listing the investment products on MERJ Exchange/
WSB (Issuer and investor community): Community of 11.1 million to participate in these investment offerings
To summarize the objectives of each player in this list:
The investment products will be tokenized on the Liquid Network, which is a sidechain of the Bitcoin network, and traded on the MERJ Exchange.
Digital Markets acts as the listing agent that is compliantly connecting the WSB investors and community with the MERJ Exchange.
You can think of Digital Markets as the glue between all of these players.
I personally think this is going to be a game-changing investment product.
I can't say for certain on the timetable for when we will see it live-trading, but I am super-impressed with all of the teams and the massive disruption they are causing.
This is only one of the many products that will be coming out of this partnership - stay tuned to hear more when they go live!
⛓ The first cross-chain security token - Mt. Pelerin
Mt. Pelerin, the Swiss-based issuance platform, and arguably the first international trading security token, has officially executed the first-ever cross-chain security token!
Mt. Pelerin tokenized its equity last year on the Ethereum blockchain and has since been trading via the Uniswap protocol.
One cool aspect of the Mt. Pelerin platform is they aim to be blockchain agnostic via their in-house built Bridge Protocol!
The Bridge Protocol enables issuers to tokenize their asset amongst multiple blockchain protocols including Ethereum, Binance Smart Chain (BSC), Polygon (ex. Matic), and xDai networks!
"But, why are there multiple blockchain options, shouldn't issuers just stick with one."
In my opinion, all tokenized assets should enable multi-chain functionality for a few reasons:
Gas fees on certain chains are too high
Capitalize on DeFi opportunities with other chains
Personal preferences on different chains
and more!
Mt. Pelerin recognized that the Ethereum network does not host a sustainable trading venue for the Mt. Pelerin (MPS) token to thrive; therefore, the team decided to enable shareholders to swap their shares to the xDai chain, to avoid high gas fees!
At the end of the day, the most important aspect when issuing assets on-chain is compliance.
As long as compliance is satisfied, the protocol utilized is not as important.
The reality is if the security token industry enables freedom of protocol choice, there will be more investors and participants, due to the fact that each protocol satisfies everyone's needs and wants differently!
Either way, a huge congratulations is in order to the Mt. Pelerin team on their momentous achievement - can't wait to see more assets utilizing the Bridge Protocol!
💦 What else is Drippin’
Dubai Regulator Announces New Regulations for Investment Tokens: Dubai is bringing regulatory clarity to security tokens!
Blockstream Raises $16M for Its Bitcoin Mining STO In a Matter of Hours: Huge demand for the STO from Blockstream due to its exposure to Bitcoin!
US Regulators Are Exploring Policy For Banks to Handle Crypto - FDIC: We may be one day soon be able to custody our crypto alongside our checking and savings accounts!
✍️ 📹 Content from the team
Thanks for tuning in! Keep an eye out each Monday for the next security token adventure 🧗♀️
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Everything in this report is for informational and entertainment purposes only. Nothing in this report should be taken as financial advice or as an inducement to purchase or sell any security. Nothing in this market report should be used as legal advice. Always do your own research before making any decisions regarding financial transactions of securities.
Disclosures:
• No money or other consideration is being solicited, and if sent in response, will not be accepted;
• No offer to buy the securities can be accepted and no part of the purchase price can be received until the offering statement is filed and only through the platform of an intermediary (funding portal or broker-dealer); and
• A person’s indication of interest includes no obligation or commitment of any kind.