Security Token news for Week Ending Friday 20 March 2020

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Here is our pick of the 3 most important Security Tokens news stories during the week:

One. Wave Financial to Tokenize $20M Worth of Bourbon for New Whiskey Fund

Digital asset manager Wave Financial is tokenizing a whole year’s production of Kentucky bourbon so global investors can gain exposure to the growing U.S. whiskey market.  Wave announced Wednesday it had finalized an agreement with the Danville, Kentucky-based Wilderness Trail Distillery to tokenize between 10,000 and 20,000 barrels of bourbon whiskey, worth up to $20 million, that will be made publicly available through a specialized digital asset fund.  By tokenizing it, Wave says investors can gain exposure to bourbon’s value appreciation and can also share some of the proceeds from when the whiskey is sold wholesale to merchants, three years after the whiskey is first distilled and tokens issued to investors.

Why it matters: The American whiskey industry has been steadily expanding production.  Whiskey is now the most exported US spirit.  Quality whiskey is an asset that has a long barrel life that tends to hold value and even appreciate with time. It is expected the fund administrator will valuate the inventory quarterly to provide a benchmark price for the whiskey-backed tokens, which will be tradable (after a one-year lockup period).

Two. BaFin Approves First Cross-Border STO in the EU – ParkinGO

This week, the German Federal Financial Supervisory Authority approved the first cross-border security token offering in the EU. The STO would give the mobility and airport parking sector giant, ParkinGO the ability to further its market dominance. The news demonstrates an expansion of the EU STO sector, as well as, a forward-looking stance on the part of BaFin.

As the first cross-border STO, the crowdfunding event would reach more EU investors than ever before…BaFin approved numerous other STOs in the past, but the ParkinGO campaign is unique in many aspects. For one, regulators allowed issuers to maintain their investors register on-chain. Additionally, the system permits secondary transactions with all rights attached to the digital asset.

Why it matters: ParkinGo, a large Italian parking conglomerate with a recognizable brand, provides airport, port and train station parking at 90 locations in 9 European countries, serving 2.7 million customers.  The token issuance platform is Luxembourg-based STOKR. The offering is to both institutional and retail investors and should be a highly visible token representing a brand European travelers know well. 

Three. Proptech KlickOwn Launches First Security Token Offering for Real Estate in Germany

KlickOwn has launched its first security token offering for real estate in Germany. Launched in mid-2019, the first digital security is for a building based in Lüneburg, Germany. The offering is debt-based seeking up to €1.5 million. As of today, the offering has raised over €350,000. Investors may anticipate a 5% annual rate of return on a “token-based bond.”

Why it matters: This small real estate token debt offering for a centuries-old landmark building is utilizing technology provided by Bitbond, which conducted the first German STO issuing its own digital bond. Germany-based KlickOwn recently launched its own security token offering as well. Security token players who have structured and managed their own STO’s issuing their securities earned the credibility and experience to perform in the STO marketplace.

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We have a self-imposed constraint of 3 news stories each week because we serve busy senior leaders in Fintech who need just enough information to get on with their job.For context on Security Tokens please read the chapter on Security Tokens in our Blockchain Economy book and read articles tagged Security Tokens in our archives. 

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