Security token offerings

AIIFL Seminar Series

11 December 2020

Security token offerings (STOs) are not initial coin offerings (ICOs) or a subset of it. This paper shows that distinguishing STOs from ICOs is crucial for the study of entrepreneurial finance. We first provide a working definition of a security token and uncover key facts about the primary STO market using a unique STO sample. The STO activity developed after the end of the ICO market bubble. The STO market is, however, still a nascent market. STOs are geographically dispersed but concentrated in jurisdictions with accommodating securities laws. Next, we explore STO success factors. We show that various issuer and offering characteristics, traditionally used in the ICO literature, also matter for STO success. We also find that success is associated with good governance practices, consistent with the corporate finance literature. We conclude by discussing the implications of native digital securities, the next generation of blockchain-based securities, for entrepreneurial finance.

The Security Token Offerings paper is written by Thomas Lambert, Daniel Liebau, and Peter Roosenboom.

About the Speaker

Daniel Liebau (Dan) is the founder of Singapore based Lightbulb Capital. The firm was founded in 2014 in Hong Kong to help realize the potential of innovation and emerging technologies to transform financial services. Dan is appointed affiliate faculty of Singapore Management University.

Dan is also a lecturer at Rotterdam School of Management’s Executive Education arm in Erasmus University. Previously, he was a visiting professor at IE business school in its top-ranked Master in Finance program, where he received the teaching excellence award for his fintech business models class. Dan teaches courses on 1) fintech & innovation in finance as well as on 2) blockchain, cryptocurrencies and digital assets. More recently, he started working and publishing on 3) data science and AI in financial markets. Also, he is a frequent speaker at seminars on blockchain and innovation in financial services.