In front of a crowd of over 500 attendees in New York, Cadence CEO Nelson Chu discussed the potential applications of tokenization at the World Blockchain Forum on November 9. Kicking off the presentation, Nelson highlighted the continuing decline of ICOs and the rise of security tokens (STO) as an SEC-compliant alternative. The differences between utility and security tokens were thoroughly explored, providing contextualized insights.
The adoption of security tokens was further examined as an opportunity to digitize traditional asset classes such as companies, real estate, and artwork. In considering these assets, along with several others, attendees were provided with a broad assessment of what should be tokenized, and what shouldn’t.
Nelson also emphasized the need for a robust STO ecosystem to facilitate widespread tokenization initiatives. Essential components of this ecosystem included: administrators, ATS, investment bankers, broker-dealers, governance, and auditors. Further, the support of institutional investors was underlined as a critical driver of scalability.
These investors require workflow tools, auditability, verifiability, settlement, custody, and distribution infrastructure to accelerate market development. Cadence has positioned itself as an emerging provider of these tools. As a bridge between traditional and digital investments, Cadence is building a platform that aims to provide the required conditions for institutional adoption.
The primary goal is to provide investors with liquid, high-yield, short-term investment products through streamlined private market infrastructure.