The Short STOry

In our series on interesting deals in the STO space, today a particular gem because of the unusual asset class and the people involved. Asset class first: this is a security token [1,2,3] giving the investors economic interest in an online game called Infinite Fleet. This security token is not to be confounded with Infinite Fleet's in game currency [4]. In terms of people involved there is obviously Samson Mow who is heading Pixelmatic, the developer of the game, and who also has quite a high profile as CSO of Blockstream, a crypto infrastructure company. The backers include Adam Back, Blockstream's CSO, Max Keiser, of the Keiser Report, and Charlies Lee the founder of LiteCoin who famously sold his holdings just before the market crashed.

The main deal platform seems to be BnkToTheFuture [5] who has supported quite a lot of companies raising fund in the crypto space, including Kraken [6,7]. The issuance is a SAFT, but they are planning to use the Liquid Network [10] eventually. Also involved STOKR [9] hence the deal being registerd both in the US and in Luxemburg.

For those interested in the legal framework under which the offering takes place, STOKR seems to only have an agent payments license from the French ACPR.

1. https://coinjournal.net/news/infinite-fleet-raises-3-1m-in-private-security-token-offering/

2. https://www.coindesk.com/charlie-lee-adam-back-private-sto-round-blockchain-game-infinite-fleet

3. https://cointelegraph.com/news/samson-mows-infinite-fleet-game-raises-31m-on-bnktothefuture

4. https://www.infinitefleet.com/gamecurrency

5. https://bnktothefuture.com

6. https://app.bnktothefuture.com/companies

7. https://www.coindesk.com/over-2000-investors-back-kraken-crypto-exchanges-13-million-crowdfunding

8. https://www.coindesk.com/bnktothefuture-ceo-50-percent-of-funding-will-be-through-security-tokens-in-2020

9. https://stokr.io

10. https://stokr.io/legal

11. https://liquid.net

12. https://www.businessinsider.com/litecoin-founder-charlie-lee-on-decision-to-sell-entire-crypto-holding-2018-4

tZero [1] -- the subsidiary of Overstock who is one of the most active players in the STO market -- just updated their investors, and whilst this do not make a particularly happy reading it provides good insights into what is, and is not, happening in the STO market at the moment [2,3]. This comes after a very positive update only in June [4], and might be related to real estate tokenisation not delivering as expected [5].

1. https://www.tzero.com

2. https://www.businesswire.com/news/home/20200729005299/en/tZERO-CEO-Saum-Noursalehi-Update-Company-Progress

3. https://www.coindesk.com/tzero-jobs-salaries-gears-another-funding-round

4. https://thetokenizer.io/2020/06/14/tzero-delivers-record-results-in-may-2020/

5. https://cointelegraph.com/news/tokenized-real-estate-hasnt-lived-up-to-the-hype-property-researcher

After the podcast on German ship finance I made two weeks ago [1] I have come across another German platform because of an pretty extensive interview in BTC Echo [2] and some other news in German media [5]. It turns out that those guys have been around for a while, there was a very good article on them in February [3] and an even earlier one last October [4], so it might well be that this is part of a concerted media push.

IMPORTANT DISCLAIMER: THIS IS NOT INVESTMENT ADVICE, I HAVE NO VIEW AS TO WHETHER THIS IS A GOOD INVESTMENT OR NOT, AND I AM IN NO WAY RELATED TO THAT PARTICULAR ISSUANCE. What I found interesting was that (a) there are two retail-focused German shipping offerings in the news, the one I talked about recently [1,8-11] and this one [6,7], and they have chosen markedly different investment structures.

1. https://theshortstory-podcast.com/2020/07/the-green-ship-security-token-offering/

2. https://www.btc-echo.de/ahoi-tokenisierung-investmentgelegenheiten-auf-hoher-see/

3. https://www.ico.li/de/new-shore-invest-lanciert-digitale-schiffsfinanzierungsplattform/

4. https://hansa-online.de/2019/10/featured/137096/hamburger-online-plattform-will-kg-modell-wiederbeleben/

5. https://blockchainwelt.de/sto/new-shore-invest-sto/

6. https://new-shore-invest.de/

7. https://new-shore-invest.de/wp-content/uploads/2020/05/WIB_RHAS-5_Stand-12_05_2020.pdf

8. https://de.cointelegraph.com/news/vogemann-raises-investment-capital-with-its-first-sto

9. https://www.vogemann.de/green-deal/

10. https://greenshiptoken.com/

11. https://www.fma-li.li/files/wp/20200703-green-ship-token-prospekt-final.pdf

In this article [1] I want to discuss the dynamics of Ampleforth [2,3], which is a crypto currency with its twist. Instead of issuing a fixed number of units, Ampleforth monetary supply expands and contracts dynamically to keep one Ampleforth valued at around 1 USD. The expansion and contraction is executed in a pro-rata manner, meaning that they do not impact the percentage of overall supply an investor holds. On first sight this looks like a stable coin, but on second sight it is clear that this is not quite the case -- it is a regular crypto coin whose price dynamics has been moved to play out in the volume space. What I mean with this is that when Ampleforth market cap goes up / down 10% then investors will feel the impact of that -- not by a change in price, but by the fact that they suddenly hold more / less currency units.

Banque de France selected the firms for its announced CBDC trial [1]. Four out of the eight companies chosen are old economy giants who are venturing into the brave new world, but the remaining four are more recent upstarts: Iznes, LiquidShare, ProsperUS, and SEBA Bank.

1. https://www.fintechdirect.net/2020/07/21/banque-de-france-turns-to-grateful-eight-for-cbdc-tests/

2. https://www.btc-echo.de/cbdc-frankreich-startet-testlauf-fuer-digitalen-euro

3. https://www.crowdfundinsider.com/2020/07/164330-banque-de-france-announces-cbdc-candidate-selections/

4. https://www.banque-france.fr/communique-de-presse/liste-des-candidatures-retenues-pour-les-experimentations-de-monnaie-digitale-de-banque-centrale

5. https://business.inquirer.net/303055/philippine-treasury-is-asia-pioneer-in-leveraging-distributed-ledger-technology-blockchain-for-treasury-bonds

6. https://cointelegraph.com/news/kazakhstan-needs-national-crypto-to-fight-corruption-says-local-official

7. https://www.seba.swiss/news/banque-de-france-candidates-testing-integration-cbdc/

8. https://www.iznes.io/en

9. https://www.liquidshare.io

10. https://prosperus.tech

It is interesting how technology gives a new lease to old principles. The medieval banking systems relied heavily on bearer instruments to assert ownership of financial assets, and this has over time be replaced with centralised registers. Now we see the rise of a new class of bearer instruments, eg via Corda, or now via CloudCoin which uses a very different -- and in many respects much more pedestrian -- way of avoiding the double spend problem.

1. https://cointelegraph.com/news/blockchain-free-cloudcoin-claims- secure-email-to-email-transactions/amp

2. https://cloudcoin.global

3. https://cloudcoin.global/uploads/CloudCoinWhitePaper2020.pdf

Before we start: this is not a financial promotion, I am in no way related to this token offering, and I have no views whatsoever of whether or not this token is a good investment. With this out of the way, I am excited that there is another major security token offering coming out of Germany, a $50m subordinated debt token for investing into green shipping assets.

The article announcing this is so far only available in German [1], but there is a lot of information on the sponsor's page [2] and the subscription page [3]. The prospectus has been approved by the FMA Liechtenstein [4].

1. https://de.cointelegraph.com/news/vogemann-raises-investment-capital-with-its-first-sto

2. https://www.vogemann.de/green-deal/

3. https://greenshiptoken.com/

4. https://www.fma-li.li/files/wp/20200703-green-ship-token-prospekt-final.pdf

After its acquisition of Swipe [5], Binance now announced details of the debit card it will be offering first in the EEA and later in the UK [1,2]. And Binance's CEO is amongst the beta testers [3,4].

1. https://www.coindesk.com/binances-crypto-card-goes-live-for-eu-uk-markets-today

2. https://cointelegraph.com/news/binances-swipe-powered-crypto-debit-card-debuts-in-europe

3. https://cointelegraph.com/news/binance-ceo-cz-showcases-first-use-of-binance-card

4. https://twitter.com/cz_binance/status/1281593589982621696

5. https://www.coindesk.com/binance-acquires-crypto-debit-card-provider-swipe-for-undisclosed-sum

I published an article on public key infrastructure and how it will impact custody and fund management today [1]. I thought I might as well read it for you on my podcast.

1. https://www.coindesk.com/how-public-key-infrastructure-will-revolutionize-custody-and-fund-management

2. https://theshortstory-podcast.com/2020/06/how-public-/-private-keys-will-change-the-world-of-financial-services-and-custody/

3. https://ec.europa.eu/digital-single-market/en/discover-eidas

4. https://www.cmegroup.com/education/courses/managed-futures/what-are-managed-futures.html

5. https://theshortstory-podcast.com/2020/05/putting-the-fun-back-in-fractionalisation/

6. https://solara.io/knowledge-base/what-is-proof-of-fusion/

7. https://theshortstory-podcast.com/2020/05/sequioa-capital-is-investing-in-ai-investment-platform-vise/

8. https://theshortstory-podcast.com/2020/05/charles-schwab-offers-fractionalised-stock-trading/

In the last days there were two Ethereum transactions [3] that paid about $2.6m in transaction fees each, which even for Ethereum is a bit on the high side [1]. After the first transaction there were two major theories: fat fingers, and money laundering [2]. Now a third one has been added [4]. So what was it?

1. https://decrypt.co/31956/an-ethereum-user-lost-5-2-million-in-two-massive-mistakes

2. https://twitter.com/lawmaster/status/1270948475883134978

3. https://etherscan.io/tx/0xc215b9356db58ce05412439f49a842f8a3abe6c1792ff8f2c3ee425c3501023c

4. https://twitter.com/gakonst/status/1270955885502836736

5. https://twitter.com/etherchain_org/status/1270927030817873920