OSC LaunchPad approves TokenGX (Tokenfunder) for Secondary Trading of Digital Securities

OSC Launchpad | Pat Chaukos | Oct 22, 2019

FreedomX - OSC LaunchPad approves TokenGX (Tokenfunder) for Secondary Trading of Digital Securities

TokenGX is the first company approved for pilot testing secondary trading of digital securities in Ontario and announces its disruptive FreedomX blockchain-powered marketplace.

October 23, 2019 – Toronto, Ontario – TokenGX Inc. (TokenGX) and its affiliate TokenFunder Inc. (TokenFunder) are pleased to announce that TokenGX has received approval from the Ontario Securities Commission (OSC) for pilot testing a secondary trading marketplace of digital securities.

The Ontario Securities Commission approved ground-breaking exemptive relief for TokenGX to launch and operate FreedomX, a secondary trading marketplace for security tokens issued by Issuers on the TokenFunder platform. FreedomX will be powered by TokenFunder’s leading edge blockchain technology. All participating investors will finally be able to buy and sell private market securities directly between themselves.

TokenGX Co-Founder Laura Pratt says “As part of the current Creative Destruction Lab blockchain cohort, our FreedomX platform will define the next generation of trading in Canada and unlock enormous value in the private markets. We envision a world where all assets will be tokenized and tradeable.”

TokenGX Co-Founder Alan Wunsche adds, “We are excited to receive the support of the OSC and specifically the OSC LaunchPad. The OSC LaunchPad team clearly understands the transformative potential of blockchain technologies in capital markets. Their willingness to grant exemptive relief in the private markets demonstrates a commitment to supporting innovation while putting investors first. This is an extremely important day for Canadian competitiveness in a global financial market.”

Wunsche continued, “TokenFunder’s leading edge security token issuance platform has a full investor onboarding and investing experience for retail and accredited investors. With today’s announcement, TokenFunder will now power the FreedomX secondary trading marketplace. With digital shares recorded on a public blockchain, we will not only dramatically reduce the cost of capital for Issuers compared to traditional platforms, but also provide liquidity through the secondary trading marketplace, which also includes critical ongoing management disclosures and investor relations services for our Issuers. These ongoing services will be good for both investors and issuers on the TokenFunder platform.”

For more information, the Decision Order is available at: https://www.osc.gov.on.ca/en/SecuritiesLaw_ord_20191023_tokengx.htm

Issuers interested in raising capital and marketplace liquidity are invited to apply at www.tokenfunder.com/onboarding/issuer

 

About TokenFunder and TokenGX

TokenFunder (www.tokenfunder.com) provides Canada’s leading security token issuance platform and investing experience designed for all investors. Its affiliate, TokenGX, is Canada’s first security token exempt market dealer. TokenGX provides high-potential startups, scaleups and mature businesses with proprietary technology and a clear regulatory path to execute Security Token Offerings (STOs) to raise capital and provide liquidity for their investors.

tokenfunder new - OSC LaunchPad approves TokenGX (Tokenfunder) for Secondary Trading of Digital Securities

Background

The Ontario Securities Commission (OSC), through the OSC LaunchPad, engages with fintech businesses that have innovative products, services or applications that benefit investors.  OSC LaunchPad assists businesses in navigating regulatory requirements and offers flexible approaches for them to fulfill regulatory requirements, including time-limited registration or exemptive relief from securities law requirements to allow them to test their innovative business models.

The Filer wishes to create a blockchain-based security token(token) trading platform for the trading among investors (investors)of their tokens that were distributed under prospectus exemptions in order to facilitate capital raising for issuers and to provide liquidity for the investors.The Filer is currently participating in the Creative Destruction Lab’s (CDL) Blockchain Incubator Stream, a 10-month program in which blockchain founders are mentored by veteran entrepreneurs, investors and visionaries in artificial intelligence and blockchain. CDL is an Ontario-based incubator program with locations across Canada and the UK that provides assistance tovarious seed-stage businesses, including technology businesses with a focus on blockchain applications.

See:  TokenFunder announces Canada’s first Security Token Exempt Market Dealer

Generally, some liquidity and transferability of tokens isdesired by investors to access their funds and for issuers in the development or growth stage of their business. Liquidity is limited for offerings of tokens under a prospectus exemption as the tokens issued are subject to resale restrictions.

The OSC recognizes that to keep abreast of and facilitate innovation, an environment to conduct commercial tests of novel business models, products and services is required. The Filer is seeking exemptive relief, as described below, to conduct a time-limited pilot test in order to gather data and operational feedback in a controlled environment, to assess the appropriate regulatory requirements, and to foster capital raising by innovative businesses in Canada and some liquidity for investors.

In the context of the OSCLaunchPad, the Filer submitted its business model and subsequently filed an application to the OSC as principal regulator to be exempted from certain requirements under applicable securities legislation to pilot test its proposed business model in a sandbox environment for a time-limited period. This Decision is based on the unique facts and circumstances of the Filer and for the limited purpose of allowing the Filer to pilot test its business in a limited commercial setting. Accordingly, this Decision should not be viewed as a precedent for other filers.

Continue to the Release --> here

View the OSC Decision Order --> here

 


NCFA Jan 2018 resize - OSC LaunchPad approves TokenGX (Tokenfunder) for Secondary Trading of Digital Securities The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

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