American internet retailer based in Midvale, Utah, Overstock.com and its blockchain subsidiary Tzero has made plans to launch a regulated exchange for security tokens in partnership with Box Digital Markets. However, the companies have to get approval first from the U.S. Securities and Exchange Commission (SEC) for the new exchange.
This internet retailer’s blockchain subsidiary t0.com Inc. (Tzero) along with Box Digital Markets announced their plans this past Tuesday. They plan to launch industry’s first security token exchange. According to the joint announcement by both firms, the new platform will list and publicly trade security tokens for companies that issue, or convert existing stock to, security tokens. After both companies get their approval from the U.S. Securities and Exchange Commission (SEC) for their new exchange, and they will both equally own the new joint venture.
The CEO and founder of Overstock, Patrick Byrne spoke to Reuters in a phone interview saying I would like to see something trading in Q3.
Box Digital Markets is a wholly-owned subsidiary of Box Holdings Group LLC, which owns and operates Box Options Exchange, a Registered National Securities Exchange under Section 6 of the Securities Exchange Act of 1934. As for Tzero, it is the first SEC-regulated crypto alternative trading system (ATS). The CEO of Box Digital Markets and President of Box Options Exchange will be appointed as the CEO of the new joint venture.
Mr. Byrne stated, “Going hand in hand with a blue-chip partner like Box would be a great advantage for us.”
In addition to that, the CEO of Tzero, Saum Noursalehi noted that together (with Box Digital), we will continue to work with the SEC as we develop a first of its kind platform that will integrate blockchain capital markets into the current U.S. National Market System.
Back in April, Byrne told CNBC that there is a safer way to raise money than initial coin offerings (ICOs), here he is referring to Security Token Offerings (STOs). He mentioned “It is the new term… The industry is distinguishing very clearly now between ICOs and STOs.” He also added “The ICO craze of last year created a toxic waste dump of financial assets. To me, that world of ICOs is a Superfund site… What we’re developing is a mechanism so that there will be a legal way to go forward and not create any new toxic waste.”
After the company released its own token sale on the 18th of December last year, that led to the SEC to begin an investigation on its offerings in February. Tzero explained, “While the SEC is trying to determine whether there have been any violations of federal securities laws, the investigation does not mean that the SEC has concluded that anyone has violated the law.”