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)

Securities laws development in blockchain and digital cryptocurrencies

After an overview of the US securities laws and regulations, we now turn to how the SEC gradually became involved in regulating digital tokens offerings and trading. We will review the SEC's analysis of how the current securities regulations apply to this regime as new issues emerge.

Some of the early warnings and guideline on investments in digital tokens are as follows.

SEC alerts

Let's look at the following few alerts:

  • Alert on the use of Bitcoin as a Ponzi scheme in July 2013 – SEC versus Shavers:

This early alert made by the SEC involving digital tokens was based on the Shavers case in 2013.

In that case, the organizer of an alleged...