Advantages of a STO
Security tokens are created and issued by a company looking to raise money, just like an ICO. Unlike ICOs, however, security tokens are backed by real assets – whether equity, debts/loans, or investment funds, for example – similar to more traditional securities. As such, security tokens fall within existing securities laws and regulations.
STOs are a better choice for businesses looking to raise capital but don’t have a suitable platform for utility tokens (as used in an ICO). That’s because the value of security tokens is based on the value of the company or underlying asset, rather than on demand driven by platform use.
The advantages of STOs are :
Low barrier for entry : Floating on a stock exchange via a traditional IPO is a time-consuming and arduous process only available to large companies. It required lots of middlemen – including brokers, exchange fees, extensive due diligence, etc. – costing large sums of money.
In contrast, a major benefit of an STO is that it can be used to tokenize any asset or financial instrument relatively easily for trading online. This means smaller, early-stage businesses can raise large amounts of capital quickly without needing to pay huge fees.
Greater flexibility for business owners : STOs provide much greater flexibility in terms of how you actually run your business – comparable only to a privately-held company. However, unlike a privately-held company, security tokens can be traded after the initial sale making them much more liquid investments.
Security tokens also have more transparent value based on the underlying assets, meaning your business is less likely to be shorted, even with a small number of large investors.
Attract global investors : Token standards are uniform across different regions, which means tokens can be easily bought and traded by investors around the world. In fact, security tokens tend to be much more liquid than privately held shares, which can be time-consuming and costly to trade.
As such, STOs tend to appeal to a slightly different investor profile than stock markets. They often attract contributions from global investors looking to make a good return with greater liquidity, helping raise large sums quickly and to spread awareness of your business around the world.
Compliance can be hard-coded : Although compliance is slightly more complex with an STO than an ICO, compliance can be hard-coded into the security token through new standards developed on blockchains such as Ethereum.
Fractional ownership : Security tokens allow you to divide underlying assets into smaller units, enabling fractional ownership. This makes it more affordable for some investors to contribute to your STO and can also make the token easier to transfer on the secondary market.
You can register your Securities Token Offer (STO) in Singapore. You can register notification as Restricted Collective Investment Scheme. You can trade your tokens in Regulated Securities Exchange.
Time Period
1. Legal Assessment - 2 weeks.
2. Preparation of Information Memorandum, Legal Review and Submission - 4 weeks.
3. Register Notification as securities with MAS - 2 weeks.
Please Whatsapp at +6587428153 if you want to find out more.
What you need to do?
1. Answer the Assessment Questions.
2. Pay a Legal Assessment Deposit of SGD $2000.
3. Upon Legal Assessment sign Service Agreement with DSMC.
4. Pay 20% of agreed amount (minus SGD $2000) for Preparation of Information Memorandum and incorporation of company in Singapore.
5. Pay 30% of agreed amount upon submission of Information Memorandum to MAS under Restricted Local Collective Investment Scheme.
6. Pay Balance 50% of agreed amount upon notification registration with MAS.
7. Appointment of Local Trustee Licensee.
Company Incorporation and Appointment of Local Trustee is paid by company.
Payment Schedule
1. Legal Assessment- SGD 2000. (Non - Refundable)
2. Sign Agreement (20% - SGD 2000) - SGD 10,000.
3. Preparation of Information Memorandum, Legal Review and Submission - SGD 18,000.
4. Upon Registration of Notification - SGD 30,000.
Total : SGD 60,000
Please WhatsApp at +6587428153 if you want to launch your STO.