The world of ICOs is undergoing a bear market. That’s pretty well known today, and not really surprising. After all, the overall crypto market is down significantly from its peak reached earlier this year. But that’s fine. If you’ve been in crypto for any length of time, you know these cycles.
But is the next crypto growth also going to be fueled by ICOs? This is a hard question. You cannot predict the future looking into the rear-view mirror, after all. In the past, trends in crypto have not lasted too long. This includes even such trends as an ICO. Or at least the nature of it might change.
However, while the ICOs as we know it might be in a downtrend, one type of ICO is on the upswing – security tokens.
That’s right – these are good old securities that we’ve been dealing with for like a hundred years. Not complicated. But also, on a blockchain. Now that’s not a selling point on to itself, but it can provide other benefits, such as leveraging infrastructure that already exists for other tokens.
The Standards Issue
Once you have smart contracts, it is not very hard to create a security token. What does a security token look like? For starters, it looks very much like a regular ERC20 token. But that’s not enough – security tokens need to be compliant with securities laws. The blockchain doesn’t know where you live or what laws you follow. This needs to be encoded in the ERC20 token itself. Can you do it by yourself? You bet. But it may not be the best idea.
The issue is that of standards really. There will naturally emerge a blockchain standard for issuing these security tokens. This standards needs to be agreed upon by the major players for adoption. It needs guidance from real lawyers with experience in the field. It needs a global framework, not just a local one. Remember that blockchains don’t know where you live.
This is a very hard coordination problem. Can Mobu solve it? It remains to be seen, to be honest. However, it is a good starting point.
Say you’re a new project and want to issue a security token. Where do you start? You can start from scratch but it takes too much time. You’re probably an entrepreneur with a bold idea, not a bureaucracy bug. You can then start with the Mobu framework.
Mobu has its own token sale going on as well, which might interest you. Check out their website for more information, and the whitepaper. If you plan to invest in the token sale, remember that ICOs can be extremely risky and you can lose all your money. Never invest more than you’re willing to lose.