A platform dealing with Security Token Offerings (STO), TokenSoft, has entered into an agreement with Coinbase, a leading cryptocurrency exchange in the United States, to provide alternative custody services.
As an alternative custody, TokenSoft indicated that entities seeking to issue a security token can choose to use third-party firms or solutions, using the platform, or using Coinbase custody. If those involved with a security token offering settle for Coinbase, then Coinbase will only provide insurance, custody, and ‘auditable control of their digital assets’ with the STO platform handling, among other things, distribution, regulation, and distribution.
While speaking to Coindesk, Coinbase Custody’s general manager, Sam Mclngvale, said that:
Reports are projecting the STO space to be worth many hundreds of millions of dollars over the next five years. When performed in a way that’s compliant with local laws, these token offerings can help companies that are perhaps too mature for seed or crowdfunding, but not quite ready to move into the VC world or look at an IPO, raise capital to get their projects moving. Working with TokenSoft it’s our goal to give these teams a one-stop-shop – from compliance to audits, to storage and distribution.
The Coinbase Custody option will be accessible using the alternative custody service, TokenSoft Global Markets, a broker-dealer arm that is under the regulatory control of the United States Securities and Exchange Commission (SEC).
The partnership comes at a time when Coinbase is not only seeking to expand the number of cryptos in the platform but also seeking to expand into new markets including Japan and Iceland. However, crypto traders in these new jurisdictions will only be able to access the retail aspect of the exchange.
Do you think the alternative custody service offered by TokenSoft will help entities issue STOs as opposed to ICOs?
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