STO DEVELOPMENT article

STO DEVELOPMENT
1. What is STO Development
STO development, offers an intuitive website that would allow you to sell your
tokens and encourage investors to start immediately. Our STO experts develop a
customized platform for your STO offerings that would attract more customers.
Security Tokens are digital securities such as assets that are used for
trading in exchange of funds from the investors. The creation of these
tokens is through the tokenization of solid assets. Security tokens need to
be compliant with Legal securities and regulations of specific regions.
Organizations that have just kick-started are inclining towards STO to build
trust among the investors for their projects.
BENEFITS OF STO DEVELOPMENT:
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Highly secure
Standard regulatory compliances
Less Volatile
Automated processes
Opportunities for fundraising
Multi-functional
Highly efficient
24/7 support
Cost-effective
Transparency

Advantages Of STO DEVELOPMENT:
Low barrier for entry : Floating on a stock exchangevia a
traditional IPO is a time-consuming and arduous process only available to
large companies looking to target over US 10m. It required lots of
middlemen — including brokers, Exchange fees, extensive due diligence,
etc — Costing large sums of money. That is to say, STO takes a short time
and costs less, and it can also facilitate financing activities.
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. 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, based on the diversity of the currency
and securities markets, security tokens tend to be much more liquid than
privately held shares.
Separate ownership: Security tokens allow you to divide underlying
assets into smaller units. This will make it easier for some small investors to
participate in matching investments and have the same rights to securities.

BFFI is providing specialized STO services to blockchain entrepreneurs and
emerging growth companies, whether in the US, Europe or Australia. We believe
that STO will be more credible than ICO, giving investors trust and support.
Three types of Token-
1. Utility token- Token that only has value in the usedof a system.Most ICOs
use utility tokens because they’re considered generally safe for most countries in the
world. Investors buy an early stake in these tokens with the assumption that the price
will go up once the utility increases and the businesses develop. From a legal point of
view the issue is that the intention is that the value will go up so the SEC uses this logic
to say that utility tokens are a security.
2. Commodity tokens- are tokens backed by a standard assets that already
have an independent value such as gold, oil or a sovereign currency.A lot of projects
focus on pegging tokens to sovereign currencies, USD being most common. Most of
their strategies are fairly simple with users giving cash to a custodial account that is
regularly audited by an outside firm but there have been rumors of problems with the
largest of these tokens, Tether, that they may not have nearly as much money as they
state they do.

3. Security tokens are tokens that equate to an ownership stake in a company
or DAO.When you buy a security token you’re buying it with the intention that the value
will be derived on the value the company or its future profits/dividends may be
worth.There are a lot of existing valuation methodologies, regulation and systems to
doing security tokens. All of this regulation forces them to be the most restrictive in who
can purchase them. Most of the systems in place for US investors will require you to be
an “accredited investor” which requires the investor to have a net worth of at least $1
million or an income of over $200,000 for the last two years.
Why More Companies Are Choosing Security Token
Offering (STO)
STOs are better in terms of features and security against both traditional security
offerings and ICOs. Here are some of the advantages of STOs over other funding
mechanisms:

High Transparency-As security tokens (or any other cryptocurrency in that matter)
are developed on the blockchain tech, the transactions involving these currencies are
public and transparent. The benefit is that such transactions are easy to verify in case of
a dispute.
Traditional investments, including securities, have a lengthy transaction procedure since
each transaction goes through middlemen, such as banks or stock authorities, before
execution, which only increases the overall time of transaction processing. Security
tokens, on the other hand, have faster execution and lower processing time because of
the lack of middlemen.
Faster Execution-
Credibility-
One of the primary reasons why ICOs have started losing their grip over investors is the
lack of accountability because, unlike security tokens, utility tokens need not be
regulated. This is why fraudulent activities and projects have increased a lot in this
space. And this is why, investors are moving towards STO, which is a more secure
investment product.
One of the major benefits of security tokens is that they can be traded at any time and
from anywhere. Since cryptocurrency trading is a global activity which is performed
online, the token holders can engage in security token trading at their own pace and
convenience.
24/7 Instant Trading-
Conclusion-
In conclusion, before using STOs to attract investors, issuers should ensure that they comply with
the relevant requirements and regulations. The rise of technology has led to more seamless

transactions along with higher risks of non-compliance. Given the unique features of blockchain
technology, the Securities and Futures Commission is tightening the rules on anti-money laundering
and counter financing of terrorism, aiming to align withFSTB’s proposal to regulate the trading of
virtual assets. Apparently, increasing regulations may slow down the application of STOs; however, it
is expected that a more extensive regulatory framework will provide more certainty for stakeholders
regarding the proper process of STOs.
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