Cryptocurrencies and a surge of ICOs have come to dominate many contemporary discussions about the market’s future, but one fast-rising trend is still going unnoticed by many investors. Across the world, security tokens are beginning to come into their own, and are rapidly developing an impressive market for themselves that will soon be at the forefront of investment activity. Investors who aren’t paying attention to the rise of security tokens are doing themselves a serious disservice.
Here’s why investors should be paying attention to security tokens, and what you need to know to cash in on this rapidly growing trend.
Security tokens are still linked with ICOs
For the most part, contemporary security tokens are still heavily linked with the surge in ICOs we’ve seen over the past few years in the minds of most investors. This is a shame, because it’s led to many investors writing off security tokens altogether; given that a large sum of recent ICOs were relatively bogus by many investing standards, some consider security tokens to be similar speculative-garbage that’s not worth their time. As a matter of fact, however, security tokens are something altogether different and worth the time and attention of any investor who’s serious about the future.
There’s tremendous financial potential behind the rise of security tokens, after all, and those trailblazers who learn about them now will be those most advantageously placed to benefit in the future. There’s already good reason to believe that security tokens represent a class of tokenizable real-world assets worth nearly $7 trillion, after all. Security tokens shouldn’t be grouped so loosely together with ICOs and cryptocurrencies as they often are today if investors want to get a clear picture as to what they really are.
Security tokens differ from utility tokens and payment tokens (like the popular Bitcoin) insofar as they’re merely traditional securities that have been digitized with modern technological means. They’re crucially subjected to federal regulations by way of the fact that they’re classified as securities which usually derive their value from being linked to a tradable asset of some sort. Right now, regulation surrounding them is in its infancy, especially since security tokens are really just beginning to come into their own.
Security tokens are widely seen as bridging the wide gap between financial institutions (and their legitimacy) and burgeoning crypto-markets which swell with promises of profit. Security tokens are determined by way of seeing if they past the Howey Test, and we’ll soon see the amount of tokens available in the market for speculative purposes tick upwards at a dizzying rate.
Security tokens are only just getting started
It can’t be stressed enough that this relatively new trend of security tokens coming into their own is the mere start of something bigger. The crypto-market is set to grow at a staggering pace, but investors need stability and predictability before they throw their cash in behind new ideas. According to security tokens news, these instruments help provide this, leveraging blockchain technology to guarantee their legitimacy to investors who may be cautious about parting ways with their dollars. Cryptoexchanges are beginning to seriously warm up to security tokens, so don’t be surprised when you hear about them more and more. While many investors are still upset that they didn’t get a chance to cash in on the original cryptocurrency boom, many are beginning to view security tokens as their next great opportunity. While the future of security tokens is yet to be written, it’s clear that they’re an exciting and still-emerging trend in the market that investors everywhere should be paying attention to.