What is an STO?

If you’re not sure what an STO is, here’s our guide on the basics.

 

What is an STO?

An STO refers to Security Token Offering, which is very similar to an ICO (initial coin offering). Upon investment, a token is given to the investor, which represents the investment they’ve put into a new form of cryptocurrency.

However, this token is used to represent an investment into something like stocks or underlying assets or bonds, rather than a new type of currency with barely any value. This is how an STO helps to bridge the middle ground between an ICO and an IEO (initial exchange offering).

 

Are STOs Regulated? 

Depending on the country a person is working in, this may vary. Many countries have long and detailed plans regarding the handling and verification of crypto assets, like the United States and the United Kingdom.

However, many countries, like China and India, have banned their use.

 

A Big Benefit of STOs

STOs carry a reputation of having a lower risk than ICOs. Security tokens have more laws around them, and there are physical assets involved, ensuring that it has real value.

 

A Big Drawback of STOs

There’s a lot of regulation burden concerning the use of STOs. They cut out the middleman in the investment process, meaning no bank is involved. This only increases the workload of an STO platform, and the amount of administration can slow down the process.

Want to take advantage of your STO? Open up an online bank account, deposit your crypto, and start using your BlockCard as soon as your application is complete.

The Latest

Unbanked Joins Visa Ready for Fintech Enablement

At Unbanked, we’re passionate about building solutions that connect traditional enterprise and banking systems with blockchain–and we’re deeply committed to building the most robust infrastructure possible in order to transform financial services as we know them today. But to build something life-changing, you need to partner with the best: that’s why we’re so thrilled to… Read Article

Purchase Litecoin with your Bank Account

At Unbanked, we believe financial access and control is a fundamental human right. For years, we’ve empowered crypto users in over 220 countries and territories around the world with the power to buy, sell, and send digital currencies–all without being subject to the transaction, exchange, or deposit fees imposed by those “other guys”. While we’ve… Read Article

5 Best FinTech Stocks to Watch in 2021

Fintech stocks are becoming more popular than ever with investors worldwide. The shift toward a cashless, technology-based society is one of the driving factors of the growth of fintech companies and their rising stock prices. From fleshed-out financial and banking services to tools that help traditional financial institutions streamline their operations, 2021 is a great… Read Article

20 FinTech Startup Companies to Know

The digital age is blazing a path for the fintech niche. It should not be a surprise that investing apps like Robin Hood and Acorns are booming. After all, the tech-savvy millennial generation has come of age. They are making money, and they are investing it. And one thing is for sure─the stuffy suits and… Read Article


6.38%

Crypto Rewards
on Spend

You also have access to:

BANK ACCOUNTS
DEBIT CARDS
BUYING, SELLING, & SPENDING CRYPTO


ARE YOU READY TO GET UNBANKED?


Nah, I enjoy high fees...

x