Are Security Token Offerings Better than Initial Coin Offerings?

TALLINN, Estonia - Nov. 1, 2019 - PRLog -- Intense debates have been all the rage these days within the cryptocurrency community and they specifically center around the emergence of STO (Security Token Offering), the newest method of raising money for blockchain projects. However, are STOs really any better than the ICOs we're already familiar with?

It has been said that the rise of the Security Token Offering will undoubtedly and assuredly crush Initial Coin Offerings, but is this really true? Commonly (or maybe not so commonly) known as the big brother of the ICO, it differs in that you actually buy real shares in the company, getting dividends and certain rights along the way. In addition, the process of launching an STO obliges companies to stand on very strict rules and regulations, unlike the ICO's, which literally anyone and everyone can start. It's also worth mentioning that the whole STO preparation stage is absolutely different and take a lot more time than your standard ICO. Market experts who are highly confident about them even predict that their market capitalization will rise up to $4 trillion by 2020.

On one hand, there is still that lingering thought of STOs, in their current form, actually taking away from the original benefits of crowdfunding that ICOs provide. On the other hand, there are more than enough reasons as to why the creation of STOs, which are registered with the (SEC) Securities and Exchange Commission unlike most of their counterparts, are miles better than the olden days of ICOs.

The first and most important reason is that they are way more secure than ICOs as SEC only allows these projects if they are found to be reasonable and serious about the goals they're aiming for. They also offer more liquidity due to fractionalization and are expected to be traded on Alternative Trading Systems (Sounds exciting, right?).

The concept of STO is a powerful idea as it helps blockchain projects be more aligned with strict government regulations, thereby opening the door to end the so-called ''conflict'' between the regulators and the blockchain community. In conclusion, we can expect to see that Security Token Offerings will be more and more prominent in the cryptocurrency industry. Come to think of it, it's actually really amazing how they allow the creation of new token paradigms which can potentially reshape the modern world!

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