This is an excerpt. To hear the full interview, please click on the Soundcloud or Youtube links
Stablecoins and asset tokenization are two of the hottest topics in the cryptocurrency space today. A growing number of companies are taking on the creation of both of these offerings.
TrustToken may be the only company within the crypto space that is offering both. The company began offering TrueUSD, a USD-pegged stablecoin earlier this year; its asset tokenization platform is currently in the making.
Recently, Finance Magnates spoke with TrustToken Co-Founder Tory Reiss about both of these offerings, the regulatory future of Cryptocurrencies
Cryptocurrencies
By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw
By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw
Read this Term in the United States, and the future of asset tokenization.
TrustToken’s “Trueusd” Was “Compliant From the Start”
According to Tory, TrueUSD is focused on institutional traders. “Essentially, funds as well as businesses--because they have a need for dealing with the US dollar, plain and simple.”
“They either recognize revenue in the US dollar, they need to transact or transmit money--or, if they’re hedge fund managers, they need a stable store of value, and they have a responsibility to their LPs when it comes to holding their funds, that they do so in a safe way.”
Here's a quick infographic we created breaking down some of the benefits of a #stablecoin https://t.co/ZsQ6dt4NGM
— TrustToken (@TrustToken) June 25, 2018
Tory explained that in order to distance TrueUSD from some of the negative stereotypes associated with pegged currencies, TrustToken took several initiatives. “If we were compliant from day one, we figured it would give our business a very strategic defense in the sense that it is a lot harder to build a compliant business than a non-compliant business...we really invested heavily upfront [in that regard].”
Therefore, “accounting firms are willing to work with us and perform attestations so that we can publish that,” he said. “I think they’d be a lot less willing to work with us if we hadn’t done all this [heavy lifting] up front.”
The latest attestation of TrueUSD funds provided by Cohen & Co is available here: https://t.co/7KDxCljut9
— TrustToken (@TrustToken) August 8, 2018
There are not very many pegged currencies within the cryptocurrency space. We asked Tory if TrustToken’s relationship with other companies that produce pegged currencies, including Tether, has more of a collaborative or competitive edge.
Tory said that excluding Tether (who he said TrustToken doesn’t have much of a relationship with), “the stablecoin ecosystem is very collaborative.”
“We’re working on a partnership with Maker to support TrueUSD as collateral for their Dye currency,” he said. “We’re also very close with the Basis team, they’re working on an algorithmic stablecoin.”
“We all view it [like this]: we are building products for very different audiences. We don’t see it as zero-sum,” he continued. “I think the media tries to make it more like it’s like this competition, and everyone’s out for each other. But one thing I really love about the crypto space is how collaborative it is.”
A “Democratization” of Financial Services
“Underwriting is the primary function that many investment banks serve today, as well as marketing deals. I think there’s a future where a lot of these intermediaries are removed, and security offerings can really function direct to the consumer, direct to the end investor.
“I think underwriting is also going to become a bit more distributed. I think we’re going to see the rise of a decentralized underwriting mechanism for registered securities offerings.
“Let’s say that you had a successful career in real estate and you know how to value a real estate deal really well. You could form a syndicate to perform due diligence and underwrite real estate deals. And then a lot of other people who might not know so much about real estate can essentially give you some of their funds so that you can essentially underwrite and put up collateral on their behalf.
The TrustToken platform is the Bridge
Bridge
The bridge or liquidity bridge is an essential component for brokers that are enabling their clients to trade at interbank rates directly via a Prime Broker or a Prime-of-Prime (PoP). While market makers do not require a bridge in order to service their clients, brokers which are sending through orders to a liquidity provider or an electronic execution venue need a bridge to connect their trading platform to the interbank market.Bridges are used extensively in forex trading, specifically for Met
The bridge or liquidity bridge is an essential component for brokers that are enabling their clients to trade at interbank rates directly via a Prime Broker or a Prime-of-Prime (PoP). While market makers do not require a bridge in order to service their clients, brokers which are sending through orders to a liquidity provider or an electronic execution venue need a bridge to connect their trading platform to the interbank market.Bridges are used extensively in forex trading, specifically for Met
Read this Term between #blockchains and $200 trillion worth of real-world assets. Our first tokenized asset TrueUSD has already reached an $80M market cap. Registration is now open on @CoinList to participate in the token sale. https://t.co/BSArsWViEz
— TrustToken (@TrustToken) July 11, 2018
Tory went onto say that this decentralization could lead to a future where financial services are more widely available. “In this way, I think that [ten years from now], anyone in the world can purchase securities directly, can get really high-quality financial products with nothing more than a smartphone. They won’t need a traditional bank account or brokerage.
“On top of that, I think that there will be this sort of micro-investment banks that will form around the world--South America, Europe, Asia, the United States. It’s very a much a democratization of these financial services,” he said.
Hopes for the Future Include Inclusive Regulations
Tory said that while he doesn’t know the future of the United States’ regulations around cryptocurrency, he knows what he hopes for.
“I hope for more clear guidelines from the SEC and the CFTC on how cryptocurrencies are viewed, and more guidelines on these Reg D, Reg C, Reg A plus type offerings.”
“I think honestly more clarity can be better, and they’re putting in the time to better understand the space. At the end of these days, a lot of these laws are really only meant to protect the American investor,” he said.
“What I hope more than anything is that they allow exposure to the average investor, not just accredited investors because that’s really the thing that will open up opportunities to the broader public. Right now, it’s pretty restricted to accredited investors only.”
“I know that was a protective measure, but I think there could be a loosening that would really help the general investor participate in the space.”
”The Security Tokens Market Will Overtake the Cryptocurrency Market”
As for the ways that the regulatory future of cryptocurrencies will affect market capitalization, Tory is of the belief that “there’s going to be a really quick ‘flippening’ where the security token market is going to overtake the cryptocurrency market.”
“The sheer magnitude of capital that’s going to flow into security tokens is going to be massive, and I think it’ll move pretty rapidly.”
“But we’ll see. It’s exciting times, that I know for sure.”
This is an excerpt. To hear the full interview, please click on the Soundcloud or Youtube links
Stablecoins and asset tokenization are two of the hottest topics in the cryptocurrency space today. A growing number of companies are taking on the creation of both of these offerings.
TrustToken may be the only company within the crypto space that is offering both. The company began offering TrueUSD, a USD-pegged stablecoin earlier this year; its asset tokenization platform is currently in the making.
Recently, Finance Magnates spoke with TrustToken Co-Founder Tory Reiss about both of these offerings, the regulatory future of Cryptocurrencies
Cryptocurrencies
By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw
By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw
Read this Term in the United States, and the future of asset tokenization.
TrustToken’s “Trueusd” Was “Compliant From the Start”
According to Tory, TrueUSD is focused on institutional traders. “Essentially, funds as well as businesses--because they have a need for dealing with the US dollar, plain and simple.”
“They either recognize revenue in the US dollar, they need to transact or transmit money--or, if they’re hedge fund managers, they need a stable store of value, and they have a responsibility to their LPs when it comes to holding their funds, that they do so in a safe way.”
Here's a quick infographic we created breaking down some of the benefits of a #stablecoin https://t.co/ZsQ6dt4NGM
— TrustToken (@TrustToken) June 25, 2018
Tory explained that in order to distance TrueUSD from some of the negative stereotypes associated with pegged currencies, TrustToken took several initiatives. “If we were compliant from day one, we figured it would give our business a very strategic defense in the sense that it is a lot harder to build a compliant business than a non-compliant business...we really invested heavily upfront [in that regard].”
Therefore, “accounting firms are willing to work with us and perform attestations so that we can publish that,” he said. “I think they’d be a lot less willing to work with us if we hadn’t done all this [heavy lifting] up front.”
The latest attestation of TrueUSD funds provided by Cohen & Co is available here: https://t.co/7KDxCljut9
— TrustToken (@TrustToken) August 8, 2018
There are not very many pegged currencies within the cryptocurrency space. We asked Tory if TrustToken’s relationship with other companies that produce pegged currencies, including Tether, has more of a collaborative or competitive edge.
Tory said that excluding Tether (who he said TrustToken doesn’t have much of a relationship with), “the stablecoin ecosystem is very collaborative.”
“We’re working on a partnership with Maker to support TrueUSD as collateral for their Dye currency,” he said. “We’re also very close with the Basis team, they’re working on an algorithmic stablecoin.”
“We all view it [like this]: we are building products for very different audiences. We don’t see it as zero-sum,” he continued. “I think the media tries to make it more like it’s like this competition, and everyone’s out for each other. But one thing I really love about the crypto space is how collaborative it is.”
A “Democratization” of Financial Services
“Underwriting is the primary function that many investment banks serve today, as well as marketing deals. I think there’s a future where a lot of these intermediaries are removed, and security offerings can really function direct to the consumer, direct to the end investor.
“I think underwriting is also going to become a bit more distributed. I think we’re going to see the rise of a decentralized underwriting mechanism for registered securities offerings.
“Let’s say that you had a successful career in real estate and you know how to value a real estate deal really well. You could form a syndicate to perform due diligence and underwrite real estate deals. And then a lot of other people who might not know so much about real estate can essentially give you some of their funds so that you can essentially underwrite and put up collateral on their behalf.
The TrustToken platform is the Bridge
Bridge
The bridge or liquidity bridge is an essential component for brokers that are enabling their clients to trade at interbank rates directly via a Prime Broker or a Prime-of-Prime (PoP). While market makers do not require a bridge in order to service their clients, brokers which are sending through orders to a liquidity provider or an electronic execution venue need a bridge to connect their trading platform to the interbank market.Bridges are used extensively in forex trading, specifically for Met
The bridge or liquidity bridge is an essential component for brokers that are enabling their clients to trade at interbank rates directly via a Prime Broker or a Prime-of-Prime (PoP). While market makers do not require a bridge in order to service their clients, brokers which are sending through orders to a liquidity provider or an electronic execution venue need a bridge to connect their trading platform to the interbank market.Bridges are used extensively in forex trading, specifically for Met
Read this Term between #blockchains and $200 trillion worth of real-world assets. Our first tokenized asset TrueUSD has already reached an $80M market cap. Registration is now open on @CoinList to participate in the token sale. https://t.co/BSArsWViEz
— TrustToken (@TrustToken) July 11, 2018
Tory went onto say that this decentralization could lead to a future where financial services are more widely available. “In this way, I think that [ten years from now], anyone in the world can purchase securities directly, can get really high-quality financial products with nothing more than a smartphone. They won’t need a traditional bank account or brokerage.
“On top of that, I think that there will be this sort of micro-investment banks that will form around the world--South America, Europe, Asia, the United States. It’s very a much a democratization of these financial services,” he said.
Hopes for the Future Include Inclusive Regulations
Tory said that while he doesn’t know the future of the United States’ regulations around cryptocurrency, he knows what he hopes for.
“I hope for more clear guidelines from the SEC and the CFTC on how cryptocurrencies are viewed, and more guidelines on these Reg D, Reg C, Reg A plus type offerings.”
“I think honestly more clarity can be better, and they’re putting in the time to better understand the space. At the end of these days, a lot of these laws are really only meant to protect the American investor,” he said.
“What I hope more than anything is that they allow exposure to the average investor, not just accredited investors because that’s really the thing that will open up opportunities to the broader public. Right now, it’s pretty restricted to accredited investors only.”
“I know that was a protective measure, but I think there could be a loosening that would really help the general investor participate in the space.”
”The Security Tokens Market Will Overtake the Cryptocurrency Market”
As for the ways that the regulatory future of cryptocurrencies will affect market capitalization, Tory is of the belief that “there’s going to be a really quick ‘flippening’ where the security token market is going to overtake the cryptocurrency market.”
“The sheer magnitude of capital that’s going to flow into security tokens is going to be massive, and I think it’ll move pretty rapidly.”
“But we’ll see. It’s exciting times, that I know for sure.”
