Transfer Agent 101
May 4, 2023
When it comes to securities transactions, accuracy and efficiency are key. That's where transfer agents come in, providing essential services to ensure that transactions are processed correctly and that the rights of investors are protected. However, understanding the work of a transfer agent can be complex, especially when it comes to the future of your business and its shareholders.
Differences between public markets and private markets
Apr 25, 2023
Securities make up a growing proportion of transfers around the world, yet the majority of them are difficult to trade since the ability to sell depends on the market they’re traded in.
Maximize returns and minimize fees for qualified purchasers and family offices
Apr 10, 2023
Qualified purchasers and family offices face unique challenges when it comes to investing their wealth. They require investment options that provide high returns without the high fees typically associated with traditional investments. In recent years, alternative investments such as primary equity fund investing have gained popularity among these investors due to their potential for high returns and low fees. In this blog post, we will provide a detailed overview of the features and benefits of primary equity fund investing, tailored to the specific needs and pain points of qualified purchasers and family offices.
Tokenize your wealth: the UHNW guide to alternative investments
Mar 20, 2023
If you're an ultra high net worth individual, you know that finding high-yielding investments with low fees can be a challenge. That's where alternative investments come in. By investing in assets beyond traditional stocks and bonds, you can potentially earn higher returns while diversifying your portfolio.
What you need to know about PEP, Politically Exposed Persons
Jan 24, 2023
Politically Exposed Persons will be considered those who perform or have performed prominent public such as:
The crypto crash course: Investor protection regulations in the world of digital assets
Dec 11, 2022
Digital assets like cryptocurrencies and NFTs were one of the fastest asset classes to gain in “value” over the last two years – and the fastest to collapse in value, too. The crash of FTX and Alameda Research is a major news and financial event, but it’s hardly a one-off. The wreckage of FTX and Alameda is piled atop that of Celsius, Voyager, Three Arrows, and others who avoided regulations intended to protect investors. Indeed, another big name – BlockFi – announced its bankruptcy just two weeks ago. The spectacular rise and fall of these previously respected names, as well as crypto and NFT prices, demonstrate both the importance of investor protection regulations and of investing in assets that actually have an underlying value.
Lending and staking digital assets for passive income
Oct 31, 2022
This week, the Federal Reserve will announce new interest rates for the United States. With more rate hikes expected, long-term investors are beginning to look at digital assets that have the potential to earn yield. While some investment strategies like digital asset lending and staking offer investors alternative ways to earn passive income potential, not all are created equal. Let’s review how these new investment solutions stack up, so investors can make more informed decisions.
What is a digital asset security?
Oct 26, 2022
One of the major stories over the past year has been the mainstreaming of digital assets such as stablecoins and non-fungible tokens (NFTs). Now, digital asset securities have taken center stage as multi-billion dollar private equity firms like KKR and Hamilton Lane begin to provide tokenized access to their investments. As more institutions launch new initiatives to provide access to these assets, investors need to understand the ins and outs of digital asset securities and how they compare to digital assets as a whole. What makes digital assets different from digital asset securities, and what are the tradeoffs between them?
What is private equity?
Oct 18, 2022
A new tokenized fund offering exposure to KKR’s Health Care Strategic Growth Fund II (“HCSG II”) recently launched on the Avalanche public blockchain. While investments in private equity (PE) have historically been primarily the domain of institutional investors, sovereign wealth funds, and ultra-high net worth family offices, tokenization is beginning to broaden access to the alternative asset class. Now, new investors want to know, what is private equity and how do PE funds work with tokenization?
Art tokenization has arrived
Oct 14, 2022
One of the biggest investment sensations over the past year has been digital art in the form of non-fungible tokens (more commonly known as NFTs), but interest and prices have collapsed under unease about the quality and value of NFTs and the unregulated, wild west space. Serious investors are looking for quality.
DTC & CDS eligibility & processing services
Oct 13, 2022
This article is intended for businesses using a transfer agent, or considering switching transfer agents.
Navigating cybersecurity in the blockchain space
Oct 6, 2022
Blockchain cybersecurity - It often seems not a week goes by without news of another hack, data breach, or theft of cryptocurrency. The latest of note? A nearly $600 million attack that halted Binance Smart Chain and a $160 million theft from digital asset market maker, Wintermute. While the details of these particular hacks are still unfolding, the fact that they happened begs the question, what should investors using blockchain-based services know about cybersecurity and what can they do to protect themselves?
Investing in art with a new kind of tokenized fund
Oct 4, 2022
Last week, Artory and the Winston Art Group (in a joint venture) launched a new, diversified art fund to broaden access to fine art as an alternative investment. The fund is the first tokenized art fund on Polygon and represents an evolution in investing in art. By enabling potential liquidity in an illiquid market, tokenized art funds are endeavoring to democratize access to an exclusive asset class. Here’s how it works.
Introducing a Web3 redemption model
Sep 29, 2022
For those unfamiliar with traditional finance, a Redemption is a liquidity event usually initiated by an investment fund.
Ethereum vs. Polygon and how they complement each other
Sep 20, 2022
When the Ethereum Merge occurred last week, it made transactions on the world’s second largest blockchain more scalable, secure, and sustainable than ever before. Prior to “The Merge,” a blockchain called Polygon spearheaded these goals using what’s commonly referred to as a Layer 2 chain (more on that below). Now, with The Merge complete, Polygon continues to complement the Ethereum ecosystem by efficiently executing transactions at a global scale. What makes them different, and how do they complement each other?
How will the Ethereum merge date impact investors?
Sep 9, 2022
Last week, Ethereum developers completed the last step of a long-awaited upgrade event called “The Merge.” This upgrade is intended to convert Ethereum’s consensus mechanism from Proof-of-Work (PoW) to Proof-of-Stake (PoS). What does this mean for existing Ether (ETH) investors, and what should Ethereum-based security token holders know ahead of The Merge?
What are net asset value reports?
Aug 24, 2022
You may have recently seen social media posts about Net Asset Value (NAV) reports and wondered, what are NAVs and what do they mean to me as an investor? In private capital markets, NAV reports evaluate investments such as private equity and open-end funds. They are typically released quarterly to help investors understand share price performance and compare investments within an industry category. Here are three ways that investors can use NAV reports to see how their investments are measuring up.
How tokenization can benefit long-term investors
Aug 10, 2022
Today, the Bureau of Labor Statistics announced that inflation slowed to 8.5% in the United States. With inflation still well above 8%, many long-term investors are searching for more meaningful returns in tokenized alternatives. Tokenization makes investing in alternatives like private equity and fine art more efficient, more liquid, and more direct than using traditional methods. And this can benefit investors by saving time and money.
15 terms new blockchain investors need to know
Jul 26, 2022
Participation in the blockchain ecosystem has grown significantly over the past year, with 47% of family offices and 43% of financial advisors currently invested in digital assets. Even traditional financial players are joining in, with JPMorgan, BNP Paribas, and Bank of New York Mellon announcing tokenization plans. As so many new people become aware of, open to, and interested in digital assets, the universe of new terms to know can be daunting. Here are the top 15 terms that new entrants to the digital assets ecosystem need to know (sorted alphabetically).
What is Web3 crowdfunding?
Jul 6, 2022
Web3 Crowdfunding is a new pathway for raising capital. This includes everything from fundraising to managing and offering shareholder liquidity.
How to create a wallet: Your key to Web3 crowdfunding
Jul 1, 2022
In this article, we will show investors how to start using digital wallets for Web3 Crowdfunding.
Discovering price in digital asset securities
Jun 30, 2022
This series of articles explores the key characteristics of how securities operate in the U.S. The previous article reviewed how assets are valued. This article will focus on price discovery, or the way marketplaces establish a price between buyers and sellers. The next article will cover how technical analysis can be used to understand the likely price direction of assets, including digital asset securities.
What makes stablecoins like USDC stable?
Jun 23, 2022
Simply put, stablecoins are digital assets that use outside capital to stabilize unit price. For instance, USD Coin (USDC) stabilizes its unit price (with each unit equal to $1) by collateralizing USDC with U.S. Dollars (USD) and short-term government obligations denominated in USD. This full-reserve collateral keeps USDC stable and redeemable on demand.
New legislation proposed to govern financial innovation
Jun 21, 2022
Last week, Senators Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY) introduced the bipartisan Lummis-Gillibrand Responsible Financial Innovation Act (the "RFIA"). With many in the digital asset industry calling for regulatory clarity, RFIA represents forward momentum and a chance to foster a greater understanding of digital asset related issues on both sides of the aisle. This article explores key aspects of the proposed bill, as well as definitions of key terms. Additional legislative proposals addressing digital assets and stablecoins specifically are expected to be introduced in the months ahead.
Are USDC yield funds the new TIPS?
Jun 17, 2022
This week, the Federal Reserve raised interest rates by 75bps, the biggest rate hike since 1994. This move follows May’s Consumer Price Index (CPI) report, which landed the United States at a 40-year high of 8.6% inflation. With near-record inflation persisting and monetary policy in flux, investors want more options. And rightly so. Fortunately, full-reserve stablecoin yield funds present a new way to combat inflation, and a modern alternative to Treasury Inflation-Protected Securities (TIPS).
You have startup equity. Now, what can you do with it?
Jun 14, 2022
If you’ve ever worked at a startup where you were offered equity as part of your compensation package, you have probably experienced that it’s one thing to receive or earn equity and something else entirely to realize its value. Many employees who earn equity don’t get the chance to take advantage of it because – without an IPO or company buyout – trading startup equity can be extremely difficult. Is there an easier way to realize your equity without an IPO?
Stay private longer. Accrue more value.
Jun 9, 2022
With volatility shaking up public capital markets, many investors looking to deploy capital feel as though they’re trying to catch a falling knife. Institutional investors watching value stocks fluctuate like growth stocks are using the opportunity to look into private market funds. And for good reason. Recently, Oliver Wyman and Morgan Stanley estimated that private market funds will reach $13 trillion in assets under management (AUM) by 2025.
Is your investment a security? The Howey test will tell you.
May 24, 2022
In his remarks at the DC Blockchain Summit on March 24, Securitize CEO Carlos Domingo observed that the vast majority of investment opportunities on the blockchain are likely securities under U.S. law. While the regulatory framework governing digital assets continues to evolve, there is a simple way to determine whether something is a security and therefore enforceable by law.
How investors can evaluate optimal prices when trading on secondary markets
May 6, 2022
This article is part of an ongoing series on the basics of investing in and trading digital asset securities in the U.S. The last article was on securities exemptions and how investors can use them to gain exposure to new businesses. This article explores how the value of digital asset securities can be assessed.
Securities exemptions are key to investing in private markets. But what are they?
May 4, 2022
The last article in this series reviewed the four most common categories of securities: debt, equity, derivative, and hybrid securities. This article will go over the securities regulations and exemptions that make raising capital and issuing stock possible without going public, as well as how digital asset securities can complement that process. Since the way investors are able to participate in private markets is determined by these regulations, understanding where they come from and why they can help investors stay ahead of the curve.
What is a security?
Apr 26, 2022
Said simply, securities are financial instruments with monetary value that can be bought, sold, or traded on exchanges and other platforms. While seemingly simple by definition, this asset class is at the center of a multi-trillion dollar market globally. According to The World Bank, domestic securities made up more than $93 trillion dollars of the global markets in 2020.
Ten years of the JOBS act: Tens of billions raised
Apr 5, 2022
Ten years ago today, the Jumpstart Our Business Startups (JOBS) Act was signed into law. Introduced and enacted on a bipartisan basis, the JOBS Act was passed as the U.S. struggled to emerge from the Great Financial Crisis, which severely impacted private businesses' access to funding through the traditional capital markets. Thanks to the JOBS Act, private businesses received enhanced abilities to raise capital – including through crowdfunding – by creating shares in the form of securities. Ten years on, the results of the JOBS Act have been incredible.
Interest rates are going up. And that can also impact your investments.
Mar 31, 2022
In March 2022, the Federal Reserve issued its first rate hike in more than three years. This move increased U.S. interest rates by 0.25%, and reinforced the market expectation that more rate hikes are coming. So, what are interest rate hikes and why do they matter to investors?
What is stagflation?
Mar 30, 2022
You may have heard the term “stagflation” in recent days and wondered, what it is and why does it matter to me? Stagflation is the combination of a stagnant economy and inflation. Put another way, stagflation occurs when an economy’s gross domestic product (GDP) declines at the same time that the price of goods and services rises (inflation).
3 things investors should know about private equity
Mar 10, 2022
Private equity (PE) is a type of alternative investment that provides the ability to gain exposure to companies that are not traded publicly. Previously, private equity was only accessible to individuals and businesses with high net worths. While PE funds have historically outperformed the S&P 500 by significant margins, access has been unevenly distributed.1,2 In the last decade, that has changed in three significant ways.
2021 In Review
Jan 4, 2022
2021 was a banner year for creative destruction. In Joseph Schumpeter’s economic theory of “creative destruction,” innovation happens from within before moving outward. From Coinbase’s initial public offering (IPO) to Securitize tokenizing funds that track S&P indices1 for the first time, 2021 marked a year of working from within the old system to make something new.
Alternative Asset Allocation for Hedging Inflation
Dec 20, 2021
For experienced and institutional investors, outpacing inflation has been top of mind lately. In the following article, we will review alternative asset allocation strategies for volatile markets.
Investing Through Black Swan Events
Dec 14, 2021
This is the first post in a series to discuss what’s trending in private equity and alternative investments. Today, we face the unexpected head on.
Selling Your Start-up Equity
Aug 17, 2021
Say you’ve been working at your start-up for a couple years and want to generate some cash by selling a portion of your vested stock. That should be easy, right? According to research from Stanford University, 56% of employees are not permitted by private-company employers to sell their stock. But what are the options for the other 44% who can sell? This depends on a few key factors. First, is there demand by outside investors for the stock or a mechanism in place to facilitate the transaction? Second, how do you find a platform to sell your shares on?
Benefits of Alternative Asset Investments
Jun 25, 2021
Why alternatives? Alternative investments offer opportunities for individual and accredited investors to find better returns, diversify portfolios, realize tax benefits and lock into predictable and passive cash flows. And these benefits are far more advantageous than you might think. Once only accessible to select institutions and high net worth clients, alternative assets are emerging as an attractive investment class for individual and accredited investors.
Shifts in Value Creation: The Rise of the Private Markets
Jun 23, 2021
Would it surprise you to know that many of the largest investable market in the United States is not the public stock market, and that this market creates more value for investors than the public market? While the internet revolutionized the trading of public stocks in the 1990s, it has barely made a dent in the trading of private securities, until now. And during that time, there’s been a profound paradigm shift between the public and private markets, and it’s changing how and where value creation occurs for shareholders.
The Road to Digital Finance: How Did We Get Here?
Jun 2, 2021
Today, many of us consider the financial institutions we interact with to be, or at least to offer, fully-digital services. The truth is, very few of them are actually fully digital. The majority of our financial system still relies on some aspect of manual human interaction; but thanks to the demand for more digital processes, things are quickly changing for the better.
What is a Digital Asset Fund?
May 31, 2021
First, let’s start with the word fund: what is it? Why does it exist? Well, just as there are “rainy day funds” or “emergency funds,” investors use funds to set aside money for a specific purpose. In this case, the money is usually pooled together from a group of investors who have interest in achieving a similar investment objective or outcome. Due to increased popularity, there are many fund types available, the most popular being mutual funds and exchange traded funds (ETFs).
Alternative Assets Explained
May 27, 2021
Thinking about diversifying your portfolio? When most people think about investing, they typically consider traditional investments. But Investments are not just limited to stocks and bonds. Alternative assets are becoming increasingly more available and are a unique way to diversify your portfolio. They offer a variety of advantages and interesting opportunities for investors.
Basics of a Security Token
May 27, 2021
Technology, updated regulations, and a new breed of fintechs are making investments more accessible and efficient on a multitude of levels. Securities like private company stocks, bonds, real estate interests, and soon even more traditional assets like public Exchange Traded Funds will become fully digital thanks in big part to blockchain technology. With the emergence of digital asset securities, the evolution of financial markets is poised to enter a new age.
The Not-So-Beginners Guide to Blockchain
May 27, 2021
Chances are you’ve heard terms like cryptocurrency, Bitcoin, and blockchain before; and chances are you’ve also heard many misconceptions about them that can cause confusion about the world of blockchain.
Differences between Public Markets and Private Markets
May 27, 2021
Securities make up a growing proportion of transfers around the world, yet the majority of them are difficult to trade since the ability to sell depends on the market they’re traded in. There are two types of markets: the public market and private market, and both act as a way for companies to finance themselves as well as a medium for investors to invest their capital. While both are predominant in the global economy, there are significant differences between the two and great variation of access across them.
Accessing Primary and Secondary Markets
May 12, 2021
Although the word market has several meanings, in finance, the term refers to the capital markets. While the markets themselves may be deconstructed into several submarkets, the primary and secondary markets denote the majority of where securities are traded. Securities are typically created in the primary market and traded on the secondary markets.