Seychelles-based securities exchange, MERJ, joins hands with the London-based blockchain provider, Globacap, to distribute security tokens to European investors. With this, the MERJ exchange house becomes the first, National Stock Exchange to list equity-security tokens. In 2018, Globacap was the first UK based trading house to issue an equity-security token under UK’s Financial Conduct Authority (FCA).
Edmond Tuohy, The CEO of MERJ Exchange Stated,
We will be the first entity anywhere in the world to hold an initial public offering of security tokens, for this ground-breaking event, it is essential to have a partner on board with the right technology, systems and approach to grasp the significance of this milestone. Globacap is among the leaders who are really executing in this space, and that resonates well with us.
FCA-regulated Globacap Ltd, in a press release, revealed that MERJ plans an Initial Public Offering (IPO) to distribute the company equity via equity-security tokens. It will sell 16% of the company’s share capital. 8.7 million of MERJ’s shares have already been indexed at the Seychelles Stock Exchange in tokenized form. MERJ CEO, Tuohy claimed that their initial public offering plans would make the platform “The primary entity on the planet to carry a preliminary public providing of safety tokens.”
Tokenized stocks are digital assets. They represent shares of a company and are easy to transfer. The use of blockchain technology allows maintaining a decentralized ledger that supports cryptocurrencies like Bitcoin and Ethereum. It also allows the easy transfer of assets between buyers and sellers and reduces costs. As they are classified as securities, regulatory restrictions have hindered non-English countries from launching such products.
Optimistic about the partnership, Globacap Founder and CEO Myles Milston said:
Globacap and MERJ share a sense of mission to bring the efficiency and cost benefits of distributed ledger technology to the regulated financial markets arena. MERJ has demonstrated unquestionable leadership and its IPO will be a landmark event in bridging regulated financial markets and the world of digital assets.
Others have also taken the initiative on safety- tokens. tZERO (an Overstock’s blockchain subsidiary corporate) has distributed its fairness safety tokens for buying and selling through authorized and non-accredited buyers. San Francisco-based safety token issuance platform TokenSoft introduced its “Know-Your-Industry” products and services to spread awareness about the necessities required for compliance with a modification to the Financial institution Secrecy Act. Grayscale Investments’ Grayscale Ethereum Trust, Ethereum-based security was open for trading on OTC markets, after receiving a green flag by the Financial Industry Regulatory Authority.
Many changes yet to come in the financial market, but for now, the MERJ stock exchange house enjoys the top position in the National Stock Exchange to trade equity-security tokens.