Coinbase and TokenSoft Partner Up For Alternative Security Token Custody Solution
Coinbase And TokenSoft Partner Up For Alternated Custody Solution
TokenSoft’s platform is known for their services for security token offerings, which is a new fundraising solution that could soon overtake initial coin offerings (ICOs), considering recent regulations. In order to provide additional solutions for their clients, they have decided to partner with Coinbase, according to an announcement on Thursday.
Now, with Coinbase on board, STO issuers have an opportunity to choose between self-custody and third-party custody. The third-party custody is where Coinbase comes in, and their exchange will provide control over digital assets through insurance, audits, and custody. TokenSoft’s role is to handle any issued related to compliance, regulation, distribution, and exchange relationships.
TokenSoft Global Markets, the new broker-dealer affiliate that remains fully regulated, will be the host of Coinbase Custody. The affiliate has already been registered with the Financial Industry Regulatory Authority (FINRA).
General Manager Sam McIngvale of Coinbase Custody said,
“Reports are projecting the STO space to be worth many hundreds of millions of dollars over the next five years. When performed in a way that’s compliant with local law, these token offerings can help companies that are perhaps too mature for seed or crowd funding, but not quite ready to move into the VC world or look at an IPO, raise capital to get their projects moving. Working with TokenSoft it’s our goal to give these teams a one-stop-shop – from compliance to audits, to storage and distribution.”
Coinbase Custody was only launched in May, and it offers high net-worth investors to store their crypto assets, given that their deposits exceed $10 million. They are presently regulated within New York State, and they comply with the current regulations. However, based on a recent statement from Coinbase, they aim to expand this type of coverage to several jurisdictions in Europe, including Andorra, Gibraltar, Guernsey, Iceland, the Isle of Man and Lithuania.
The customers in the aforementioned European locations would be able to fully access all parts of the Coinbase retail service, using the website and mobile apps for trading. In the future, they plan to integrate the Coinbase Prime and Coinbase Pro services as well.