I like this token format a lot for moving into public trading after a successful Reg A+ filing. My suspicion is that we will have a period during which offers will go into the private market in 2018, and then the more actively traded deals will be promoted to Reg A+ going in to 2019. The Reg A+ market is currently jammed up for two reasons. First, the SEC is not approving Reg A+ prospectuses that describe security tokens. There are more than 30 in the queue, and we are not aware of any that have come through in 2018. Second, one of the most important features of a Reg A+ offer is public trading and liquidity. This doesn’t exist on current exchanges. It will come through a new generation of exchanges that are designed for tokenized private and Reg A+ securities.
So, my goal would be structure the security from birth to use an ERC20 format, with tracking of investors, that can be promoted from a private whitelist to full public trading.
There are a number of rules for running a US exchange, and one of them is the requirement for a “transfer agent” — a database that keeps track of all of the holders of of a security by name. Many of the emerging exchanges want to either force securities to do an initial offer on the exchange (which gives them a complete database of holders and makes them a big fee, but costs time and money) and/or hold the tokens exclusively on the exchange and track the tokens exclusively in their transfer agent. So, the tokens would be trapped in the US and on a particular exchange. I strongly believe that global blockchains should support global offerings with a choice of exchanges. So, we are putting in a issuer registry that tracks buyers globally. You can them move to your choice of exchange or exchanges, after you get the Reg A+ prospectus and disclosures approved, by feeding that information into the ID attestations and transfer agent of the chosen exchange.