Book Image

Security Tokens and Stablecoins Quick Start Guide

By : Weimin Sun, Xun (Brian) Wu, Angela Kwok
Book Image

Security Tokens and Stablecoins Quick Start Guide

By: Weimin Sun, Xun (Brian) Wu, Angela Kwok

Overview of this book

The failure of initial coin offerings (ICOs) is no accident, as most ICOs do not link to a real asset and are not regulated. Realizing the shortcomings of ICOs, the blockchain community and potential investors embraced security token offerings (STOs) and stablecoins enthusiastically. In this book, we start with an overview of the blockchain technology along with its basic concepts. We introduce the concept behind STO, and cover the basic requirements for launching a STO and the relevant regulations governing its issuance. We discuss U.S. securities laws development in launching security digital tokens using blockchain technology and show some real use cases. We also explore the process of STO launches and legal considerations. We introduce popular security tokens in the current blockchain space and talk about how to develop a security token DApp, including smart contract development for ERC1404 tokens. Later, you'll learn to build frontend side functionalities to interact with smart contracts. Finally, we discuss stablecoin technical design functionalities for issuing and operating STO tokens by interacting with Ethereum smart contracts. By the end of this book, you will have learned more about STOs and gained a detailed knowledge of building relevant applications—all with the help of practical examples.
Table of Contents (9 chapters)

Federal regulations

In this section, we will cover some important federal regulations in the blockchain space.

Section 5 of the Securities Act of 1933

The federal securities law governing the offer and sale of a security is covered under the Securities Act of 1933, (the Securities Act). The purpose of the Securities Act is to protect the general public from making investments in fraudulent schemes. The Securities Act requires the disclosure of information that will be significant for the investors to make investment decisions. This is the main reason that the SEC requires issuers that offer and sell securities in the US to file registrations of such offerings.

Under Section 5 of the Securities Act, generally, an offer or sale...