Overstock’s Platform Kicks Off tZero Token Trading
As expected, the security token platform of tZero went live at the end of the business week, launching one of the early secondary markets for security tokens.
Overstock, one of the crypto-friendly retail sites, has finally launched its tZero trading platform and token, creating a secondary market for its original asset. In the future, it may stock other security tokens.
Trading is open to accredited investors through a brokerage account with Dinosaur Financial Group, which will act as the introducing broker-dealer. Unlike utility tokens, security tokens have a more limited outreach to comply with traditional financial product requirements.
“A new efficient and transparent path for capital formation via blockchain is now a reality, but those who have followed our journey know that today’s announcement is just one more step down a path,” said Overstock.com founder and CEO Patrick M. Byrne, who serves as executive chairman of tZero.
Exchanges for security tokens are only beginning to appear in the USA and the European Union, with still rather limited outreach in comparison to digital asset exchanges. However, Overstock’s tZero may open the door to institutional investors buying into upcoming projects that opt for a security token offering (STO) instead of an initial coin offering (ICO).
Dinosaur Financial senior VP Elliot Grossman commented:
“We see this as a truly evolutionary step toward improving transactional transparency for investors, while providing an efficient and secure alternative to over-the-counter trading or a listing on one of the legacy stock exchanges for companies seeking to raise capital.”
In the US market, tZero will compete with Open Finance Network, and it is still uncertain how many new platforms will appear. In Europe, Extauri, Neufund, and DESICO have all launched markets for the issue and secondary trading of security tokens although live deals are yet to happen.
In the past, Overstock has been targeted by the US Securities and Exchange Commission for attempting to sell unregistered securities. In the months since the ICO, the parent company has made the token and trading platform compliant with the relevant laws.