One of the lingering issues with the cryptocurrency industry has been how to go about correctly valuing coins and tokens, with pricing fluctuating wildly in many cases. Token devaluation is a problem that DESICO are looking to solve.
Based out of both Paris, France and Vilnius, Lithuania, DESICO is currently in the process of building a platform for the issuance and trading of tokenized securities, all done in full compliance with EU member state law, providing a legally compliant solution for ICO investment.
Why do many ICOs fade so quickly?
Depending on market conditions, many ICOs tend to fare reasonably well at the start, only to seemingly die off and disappear.
Coinmarketcap’s top 20 list on any given year will look very different from the year or two previous, with many top projects from 2016 not even being mentioned a few years later.
Case in point, Namecoin was sitting 13th in Coinmarketcap’s top 20 in 2016, but by 2018 had dropped all the way down to 189th.
The reason for this kind of drop in many cases is cryptocurrencies being almost entirely speculative.
On September 6 in San Francisco, DESICO announced that they had created a solution to some of the regulatory issues the cryptocurrency market is facing, and a solution to bring proper price valuation to coins and tokens.
Anthony Pompliano, Founder and Partner at Morgan Creek Digital Assets, describes tokenized securities as “digital assets subject to federal security regulations. In layman terms, they are the intersection of digital assets (tokens) with traditional financial products — a new technology improving old things.”
The DESICO team share several core beliefs which have fuelled their platform development, and Founder and CEO Laimonas Noreika believes ICOs lack investor protection in the following ways –
No real shareholders rights
Misleading information by ICO issuers
Lack of transparency post-ICO
In addition, Noreika believes that ICOs face all manner of friction, including difficulty interacting with the conventional banking system and problems being listed on crypto exchanges.
The DESICO platform will allow startups to build their tokenized security, then offer potential investors the token in a fully transparent way with clearly defined returns and terms.
This ensures investors have investment rights, backed by legal compliance.
Changing the image of ICOs
In a nutshell, DESICO is changing the belief that ICOs are just a way for individuals to escape with investors money, leaving behind no legal safety net for investors.
The company is also offering startups the opportunity to conduct their business safely and transparently, with protection for investors.
Commenting on how DESICO can provide a way for retail investors to both invest and trade tokenized securities and ICOs, Co-Founder Audrius Griskevicius said that DESICO crowdfunding laws permit tokenized security issuers to raise capital “from retail investors up to EUR 5 million per year, through crowdfunding platforms like DESICO. DESICO will also have a regulated exchange, meaning that issued tokenized securities will be tradable on day one.”
“DESICO is among the first platforms to offer tokenized securities for retail investors and will get some traction organically.”
At the moment DESICO is in the process of raising a USD 5 million equity round to complete the acquisition of the required licenses, legal fees and software development, which will be followed by their own tokenized security offering.
Lover of all things crypto, blockchain and AI, professional tech scribe & part of the editorial team at Crypto Disrupt.