Why Tokenize?

Asset “tokenization” significantly improves the primary issuance, secondary trading, and lifecycle management of an asset.

Tokenized assets transform the capital formation process by automating costly compliance requirements
through a transparent & immutable ledger. 

 

Asset “tokenization” significantly improves the primary issuance, secondary
trading, and lifecycle management of an asset.

Primary Issuance
• Programmable, verifiable compliance
• Simplified share distribution

Secondary Trading
• Ability to trade 24/7 on a variety of exchanges increases liquidity
• Near instant trade settlement time

Lifecycle Management
• Programmable dividend/profit sharing distribution, cap table management,
transfer agent duties, etc.
• Streamlined tax and accounting document generation

Oracles & Smart Contracts: how compliance is programmatically achieved

• Determine the Validity of a Transaction
Oracles are a data source outside of the blockchain network that can be
referenced by a smart contract to determine the validity of the transfer function
in the smart contract

• Customizable and Flexible per Asset
Oracles, for example, can provide a whitelist of accredited or qualified investors
that can be checked whenever a transaction of a security token is called upon

• Central Source of Truth
T-REX’s managed data services will be referenced in both the deal origination,
share distribution, lifecycle management and secondary trading by AlphaPoint’s
smart contracts for each asset-backed token to ensure thorough compliance
based on investor KYC status, share restrictions from the PPM, etc.

Characteristics of an Illiquid Asset
What Makes an Asset Illiquid?
1. No price discovery: obstacle presented by a limited marketplace
2. Lack of transparency: Value of asset is either hidden/invisible or not discernable
3. High counterparty risk: Risk that the other side of the transaction will be unable to meet
its obligations
4. No guarantee of settlement: Risk of not receiving what you signed up for due to
things like misinformation, miscalculation/fraud or other reasons
5. High frictional cost: excessive transactional fees or hidden costs that don’t justify
liquidation of assets (e.g., result is 20-30% illiquidity discount)

Why Security Tokenization for the ABC Industry?
1. Improved Liquidity
2. Increased Transparency
3. Lower cost of capital
4. Bond ownership certainty
5. Ability to redefine deal roles and return capital to the transaction

Interested to find out more? Feel free to reach us anytime with any questions regarding tokenization or blockchain related at partners@dexfin.exchange .