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Security Tokens – The Future of Fintech

I read this great thesis on security tokens this week by Stephen McKeon. Here it is.

Stephen believes the infrastructure to support security tokens is now being built out. He defines security tokens as any blockchain based representation of value that is subject to regulation under security laws. These eight features listed below form the foundation of the thesis that security tokens will see widespread adoption across numerous asset classes in the coming years.

1. 24/7 markets2. Fractional ownership3. Rapid settlement4. Reduction in direct costs5. Increased liquidity and market depth6. Automated compliance7. Asset interoperability8. Expansion of the design space for security contracts

I am really excited about all eight features but the first four are upon us now. As an investor, I really look forward to this world:

Long-short strategies have been used in stock markets for years and these will expand to any asset class with fractionalized ownership. Imagine being able to go long Brooklyn and short Manhattan, thereby creating an “NYC market neutral” real asset portfolio.

Have a great Sunday.

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