By
Babafemi Adebajo
June 14th, 2023
Both Archax and InvestaX have very solid footings in their countries, standing as regulated platforms with notable interests and influence in the industry especially when Security Token Offerings (STOs) are concerned.
Hong Kong’s BC Group has partnered with Archax and InvestaX on a mission to develop the market to global standards. According to available information, the three firms will be combating cross-border technical issues as well as regulatory interoperability on the issues around security tokens.
Security tokens, per Gemini, are a representation of ownership within a company, and unlike utility tokens, cannot be traded for services or paid out as rewards.
The consortium comes in light of the global “travel rule” set by the Financial Action Task Force and implemented across multiple jurisdictions on the issue of anti-money laundering campaigns.
Per the report, the consortium forms the “International Security Token Offering Alliance (ISTOA)” alongside a working group commissioned to establish best practices to govern security tokens. Heading the list of agenda is the determination of best technical issues as well as regulatory practices on matters such as issuing, listing, trading and settling token securities on the blockchain.
According to the CEO of Hong Kong’s BC Group, Hugh Madden, the market for security tokens is still budding, and the tri-partisan association is intended to develop this market. Madden added that identifying critical integrations and anti-money laundering principles is key to enabling cross-border trading for the tokens.
It follows that a licensed operator with token trading qualifications will have varying experiences trading or issuing tokens between different jurisdictions. Per Madden, the variations revolve around token characteristics and requirements.
While their ultimate objective is establishing industry standards, there remain certain concerns, like the technology of choice, which corporate governance to use and the token AML/FATF features. These concerns must be addressed before security tokens can be listed across the three regions Madden, however, hopes that that will be achieved before the end of this year.
Both Archax and InvestaX have very solid footings in their countries, standing as regulated platforms with notable interests and influence in the industry especially when Security Token Offerings (STOs) are concerned. Dan Simon of the BC Group termed the consortium a “group of like-minded firms”.
The three companies are all leaders in their individual settings, BC Group being the only licensed crypto exchange OSL in Hong Kong while Archax stands the first licensed UK Financial Conduct Authority (FCA) digital securities exchange and custodian. InvestaX on the other hand is a famed investment and trading exchange with an operating license from the Monetary Authority of Singapore (MAS).
