Nasdaq May Launch a Security Token Platform for Regulated ICOs

Julien GONG Min / Flickr

Nasdaq (NDAQ), the second-largest stock exchange in the world by total capitalization, is reportedly exploring a possible security token platform to support regulated initial coin offerings (ICOs).

According to a recent report by The Block that cites insiders familiar with the matter, Nasdaq is interested in developing a platform for companies to stage security token offerings (STOs) to issue tokens and raise funding.

Unlike other cryptocurrencies, security tokens are designed to be tradable assets and are issued to investors in the pursuit of future profits. Similar to traditional securities, these tokens are subject to significant regulatory standards.

While many ICOs¬†could likely be classified as security sales, STOs function fully under¬†existing U.S. securities law, opening the door to accredited investors to gain exposure to digital assets. If Nasdaq were to launch the platform, it would be in direct competition with other STO companies, including Overstock’s¬†tZERO¬†and AngelList spin-off,¬†CoinList.

This news comes after¬†previous¬†breaking reports, which cited a “trusted Nasdaq source” familiar with the matter, revealed that the financial giant is making a concerted effort to push forward the listings of many notable cryptocurrencies, including Bitcoin (BTC) and Ethereum (ETH), as early as 2019.

[Read: How to Gain Exposure to Security Tokens as a Retail Investor]

As it stands today, none of these reports have been confirmed by Nasdaq but their interest in the emerging asset class has been firmly established in 2018.

For instance, we previously reported that Nasdaq is considering bringing crypto data to the Analytics Hub, a market research tool that was launched in 2017 to help users parse unstructured data to make informed investment decisions.

Nasdaq also drew significant attention after it reportedly hosted a closed-door meeting that included representatives from about half a dozen companies, including Gemini and other cryptocurrency exchanges.

Regardless of which internal program hits the market first, Nasdaq’s entry into the crypto market will provide a level of trust not yet present in the industry.

More: Nasdaq is looking at gatecrashing a red-hot industry with a platform to issue tokenized securities
Photo: Julien GONG Min / Flickr

Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.

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