According to a press release, published on January 24, tZERO, the newly launched security token exchange by the e-commerce giant, Overstock is now live. The release also says that the accredited investors can now trade their tZERO security tokens that were first introduced during the firm’s security token offering (STO) in August 2018.
The STO had managed to raise $134 million from over 1,000 accredited investors who bought tZERO security tokens at $10 a piece, and investors who were a part of the pre-sale got them between $5 and $8 apiece. According to tZERO’s Telegram group, the first trade saw 10 tokens bought at $8 apiece, which is $2 lower than the STO price.
The trading of tZERO security tokens is being done through a digital securities brokerage account at Dinosaur Financial Group where Dinosaur will be acting as a broker-dealer because they partnered with tZERO subsidiary PRO Securities in order to provide an alternative trading system for tZERO security tokens.
The CEO of tZERO, Saum Noursalehi said:
“The world of security tokens has lacked a regulated venue for secondary trading. The trading of our own security tokens is the crossing of the Rubicon for the new world of digital assets. This will create liquidity, democratize access, bring transparency and efficiency to global markets and accelerate the adoption of security tokens.”
The trading platform will be operational during normal market hours between 9:30 am and 4 pm EST so that it can position itself with mainstream Wall Street finance and appease regulators.
Noursalehi, in an attempt to explain their approach also said:
“Our approach has been incremental: getting some benefits of blockchain but not going full-blown, and this is also something that made the regulators comfortable with letting us move forward. Initially, we did it to kind of mimic the market, but Dino is our broker-dealer at this point and we wanted to make sure there is support available for investors during the broker’s business hours.”
tZERO also aims to develop their technological capacity so they can help other companies issue their own security tokens and trade them on the platform. It has been designed as an alternative trading system (ATS), which is a trading platform which have to abide by lesser rules and regulation as compared to an exchange. However, this also results in the platform being registered as a broker-dealer and deals solely with private equity, not publicly traded companies.
Overstock chairman, Patrick Byrne’s goal is to disrupt the whole traditional system of security trading. which is why tZERO is planning to launch a new exchange for publicly traded stocks.
According to Noursalehi, tZERO partnered with BOX Digital Markets, a subsidiary of the Boston’s Options Exchange, so as to create the securities token marketplace Byrne and himself are aiming to build. He further added that this new exchange will be called the Boston Security Token Exchange (BSTX).