A token offering is used in the cryptocurrency market to raise funds by issuing security tokens. Unlike initial coin offerings (ICOs), which offer coins or tokens to investors, RWAs involve the issuance of tokens that represent ownership or financial rights in an external asset or enterprise.
Digital assets have gained significance in the cryptocurrency market due to their potential to tokenize real-world assets. Brickken facilities this process by providing everything you need from the pre-stage of launch right the way to post-launch tweaks.
An launch can be broken down loosely into three stages.
Preparing for an RWA before its launch is crucial for several reasons. First, compliance with investment regulations and legal requirements is essential to ensure a smooth and lawful fundraising process. RWAs often involve adherence to securities laws and regulatory frameworks, making it necessary to navigate these complexities.
Second, the careful design of security tokens can contribute to the success of capital-raising efforts. Factors such as attaching voting rights to tokens have increased the odds of success in digital assets. Lastly, professional execution of the offering can foster general awareness of the benefits of a well-developed RWA market.
Here we will focus on what you need to pay attention to before you launch so that you can have the highest possibility of your token being a success.
In the context of fundraising methods, RWAs use white papers to present their projects to potential investors. However, there are notable differences between the white papers for ICOs and RWAs.
White papers for RWAs center around securities offerings and compliance with relevant regulatory frameworks. These white papers provide detailed information about the underlying assets or rights associated with the security tokens. They cover aspects such as the legal structure, ownership rights, dividend distribution, governance mechanisms, and regulatory compliance measures. RWA white papers often emphasize transparency, regulatory compliance, and investor protection to instill confidence in potential investors.
Check out the Brickken White Paper as a reference if you like.
Tokenomics refers to the economic design and mechanics of a token within a blockchain-based ecosystem. It involves various factors, including token supply, distribution, utility, governance, and incentives.
A well-designed tokenomics model is crucial for a RWA as it provides clarity on how the security token will function within the project's ecosystem. It helps align the interests of investors, stakeholders, and token holders while ensuring the token's value proposition and utility are well-defined. A professional tokenomics model considers factors such as token issuance mechanisms, vesting schedules, token distribution, token governance, and mechanisms for value appreciation.
The tokenomics model should be closely integrated with the legal aspects of the project to ensure compliance with applicable laws and regulations. This integration helps address legal considerations such as securities laws, investor protection, and regulatory compliance.
By working closely with legal experts, the project team can ensure that the tokenomics model aligns with the legal requirements of the jurisdiction in which the RWA is conducted. This includes considerations related to securities classification, exemptions, investor accreditation, and compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations.
Furthermore, to enhance transparency and build trust with potential investors, third-party audits of the tokenomics model and financial aspects of the project may be necessary. Third-party auditors can assess the accuracy, reliability, and fairness of the tokenomics model and provide an independent evaluation of the financial projections, ensuring they are based on reasonable assumptions.
The project's website plays a significant role in the initial point of contact for potential investors. It serves as a primary source of information and a gateway to engage with the project and its team. The website should effectively convey the project's value proposition, investment opportunity, and relevant details to capture the interest of potential investors.
a) Clear & Engaging Content: The website should present information about the project, its objectives, the problem it aims to solve, and the unique aspects that differentiate it from competitors. The content should be concise, engaging, and tailored to the target audience.
b) User-Friendly Interface: The website should have a well-designed and intuitive user interface that enables easy navigation and access to essential information. It should be optimized for different devices and provide a seamless browsing experience.
c) Team & Advisors: The website should introduce the project team members, their backgrounds, expertise, and any notable advisors associated with the project. This helps establish credibility and instill confidence in potential investors.
d) White Paper: The website should provide easy access to the project's white paper, private placement memorandum, and any other relevant documentation. These materials should be downloadable and easily understandable.
e) Contact & Support: Contact information, including email addresses and social media links, should be readily available for potential investors to reach out with inquiries or requests for additional information. Prompt and professional support can enhance investor confidence.
When forming a project team for a Real-World Asset (RWA), several key roles and responsibilities are essential to ensure the smooth execution of the digital asset and the project's success. These key roles typically include:
Project Managers
The project manager oversees the entire RWA process, coordinating activities, setting timelines, and ensuring the project stays on track. They are responsible for overall project planning, resource allocation, risk management, and communication with stakeholders.
Legal and Compliance Experts
Legal and compliance professionals play a crucial role in ensuring the digital asset complies with relevant security regulations and other legal requirements. They assess the project's compliance with securities laws, draft necessary legal documents, handle regulatory filings, and provide guidance on investor accreditation and compliance procedures.
Financial Experts
Financial experts, such as CFOs or financial advisors, contribute their expertise in financial modeling, budgeting, and valuation. They help determine the project's financial feasibility, structure the offering, and provide insights into investor expectations.
Technology Experts
Technology experts, including blockchain developers and architects, are responsible for implementing the technical infrastructure required for the security token issuance and subsequent token management. They ensure the security, scalability, and functionality of the tokenized ecosystem.
Marketing Specialists
Marketing and communication professionals play a crucial role in promoting the RWA, attracting investors, and building a positive brand image. They develop marketing strategies, create engaging content, manage social media presence, and organize outreach efforts.
Introducing your team in advance, fully doxxed, helps for a number of reasons.
Transparency & Credibility: By introducing the project team members early on, the project demonstrates transparency and establishes credibility. Potential investors can assess the team's qualifications, expertise, and track record, which helps build trust in the project's execution capabilities.
Investor Confidence: Knowing the key players behind the project instills confidence in potential investors. Recognizable names or individuals with relevant experience in the industry can attract more interest and investment.
Networking and Partnerships: Announcing the key players in advance can help the project team network with industry experts, potential partners, and advisors. This can lead to valuable collaborations and access to resources that enhance the project's success.
Media Coverage & Publicity: Publicizing the project team's expertise and involvement can attract media attention and increase the project's visibility. This exposure can generate buzz, attract potential investors, and create a positive perception of the project.
Equity tokens represent ownership or equity in a company. Holders of equity tokens have ownership rights, such as voting rights and entitlement to a share of profits or dividends. These tokens are similar to traditional shares of stock but are represented digitally on a blockchain.
Debt tokens represent a debt or loan agreement between the token holder and the issuer. Holders of debt tokens have the right to receive periodic interest payments and the repayment of the principal amount at maturity. Debt tokens can provide a fixed income stream to investors.
While utility tokens are often associated with utility or non-security tokens, they can also have security features. Utility tokens grant access to a product or service within the project's ecosystem. In some cases, utility tokens can have security-like characteristics, such as profit-sharing or revenue-sharing features.
If the token has utility value, it should provide tangible benefits within the project ecosystem. This can include access to goods, services, or exclusive features that create demand for the token.
If the token represents a security, it can provide investors with profit-sharing or revenue-sharing mechanisms. This allows token holders to participate in the project's financial success through dividends, revenue distributions, or token buybacks.
Tokens can grant holders governance rights, enabling them to participate in decision-making processes, such as voting on project proposals, protocol upgrades, or changes in token economics.
Providing liquidity options for token holders, such as the ability to trade on secondary markets or participate in token buybacks, can enhance the token's attractiveness to investors.
Security tokens are subject to federal security regulations, which aim to protect investors and ensure market integrity. In the United States, the primary regulatory framework governing security tokens is the Securities Act of 1933 and the Securities Exchange Act of 1934, administered by the Securities and Exchange Commission (SEC). These regulations require offerings of security tokens to comply with registration or exemption requirements, depending on the offering type and the nature of the investors involved.
Other jurisdictions may have their own securities regulations, such as the European Union's Markets in Financial Instruments Directive (MiFID II) or the Swiss Financial Market Supervisory Authority's (FINMA) guidelines on token sales.
Following legal regulations is of paramount importance for digital assets to ensure credibility and security for investors.
