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Standard Tokenization Protocol: The Decentralized Smart Contract Platform

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Online transactions are always accompanied by volatilities that make users apprehensive about the whole concept. From personal information to bank details – anything can be breached through little loopholes. Blockchain technology has been regulating the digital transaction by offering a decentralized ledger that records all the transactions happening in such a way that they cannot be altered or manipulated. 

Over the years, blockchain technology and cryptocurrency have been able to regulate the discrepancy issue to some extent. There are plenty of things that aid the blockchain technology and facilitate the safe and easy transaction. A great example for that would be smart contracts – a line of code stored on the blockchain which is automatically executed when all the conditions are met by both the parties. See it as a contract with smart features; it is basically a transaction protocol that executes automatically when all the documents related to the actions are verified. 

In the context of blockchain, smart contracts have been extremely helpful for businesses and crypto exchanges trading cryptocurrency. In this article, we are going to talk about a revolutionary smart contract platform that is set to bring innovation to the token system. 

Without further ado, let’s get started.

What is Standard Tokenization Protocol?

Whether you are a blockchain-enthusiast or a cryptocurrency trader, you would know how important smart contract platforms are. Standard Tokenization Protocol or STPT is a brand new smart contract protocol that is meant to issue token offerings in a regulatory manner. 

It is true that there was a lack of transparency in the transfer and issue of tokenized assets, and Standard Tokenization Protocol is aimed at bringing clarity to the process.

It is an open-source standard that issues and transfers tokenized assets by fulfilling all the necessary requirements. STPT tokens use on-chain compliance validators of the protocol to cross-verify the agreement with a particular jurisdiction or the issuer’s specific requirements.

Standard Tokenization Protocol will ensure that all the assets are tokenized in the most compliant way with respect to the blockchain platform in any jurisdiction. 

What is the Compliance Validator?

A compliance validator is the main feature of the STPT network. It is used for two major functions: issuer compliance and jurisdiction compliance. The jurisdiction compliance ensures the regulations with a specific region, whereas the issuer compliance is based on the issuers’ regulations. The first task of the validator is to adhere to respected jurisdictions’ regulations. Secondly, it must be compliant with the issuer’s parameters and regulations before the issue of assets. 

What is A Validator Committee?

A committee is established to validate the accuracy and ensure that the protocol enforces the compliance with utmost regulation and standards. The validator committee is made up of a group of individuals elected by the token holders. It cannot include the industry’s leading advisors, securities lawyers, legal advisors, regulators in a different jurisdiction. The main aim of the committee is to ensure the functionality of the protocol.  

Key Benefits of Standard Tokenization Protocol

There are some of the major highlights of this platform that make it unique. Here are some of the benefits of the STPT network you should focus on:

  • The protocol facilitates the integration of different regulations that will help in the compliant issue of the tokenized assets and transfer of ownership across the jurisdiction. 
  • There are plenty of issuer-friendly parameters, like holding periods, transfer of ownership, ownership concentration, etc. 
  • The compliance of issuer-specific regulation in the smart contract at the contract level. 
  • Integration and capture of changes in the regulatory landscape. 
  • STPT allows tokenizing of any sort of asset in a thoroughly compliant manner internationally. 

Who are The Key Players in STPT Network?

There are three major players in the Standardized Tokenization Protocol that benefit a lot from this smart contract platform. Let’s see how these three avail the perks of STPT. 

Issuers: These are the owners of the assets who come to Standardized Tokenization Protocol to tokenize their assets. This platform helps in originating, structuring, and executing the syndication and tokenization of the assets. Issuers are most benefited from the STPT network as they get to tokenize their assets compliant with the particular jurisdiction. 

Institutions: Institutions are the leverages who can make use of the available blockchain technology for different purposes. These institutions can harness the Block72 for many uses like industry research, sales, and trading, liquidity solutions, merchant banking services, restructuring, etc. 

Retail Investors: These are the ones who help the STPT network to strengthen its hold, in return for outsourced services. They can make use of the investment platform of the Block72 mobile app that aids assets and token management services. 

Major Use Cases of STPT Network

Offering tokenized assets in a compliant way is what STPT does for the issuers. It combined all the features of token offerings, public offering, and blockchain smart contracts to provide more benefits that were impossible earlier. Here are a few use cases of STPT network that you need to know:

#1 Automation of Entire Compliance

STPT has provided brand-new transparency for the tokenization process. It has provided some revolutionary features like public confirmation of the legal compliance, real-time verification of cap tables, clear guidance on legal issues, rejection of non-compliance trades. It is a perfect way of moving from reactive to proactive compliance. Automated compliance with STPT has made sure that token offers are completely compliant with the validator’s help. 

#2 Better Programmability

Programming value from one individual to the other if all the conditions are met can make things a lot easier and dramatically lower operational costs. STPT network facilitates the pre-programming transfer of tokens to issuers that will reduce the manual work that comes with the process. It is expected that in the coming years, more tokens will emerge, such as hybrid tokens that will possess the ability to auto-convert between debt and equity-like instruments based on the parameters and performance. 

#3 Onchain Crowdfunding

Crowdfunding needs a decentralized network to regulate its processes. With the help of Standard Tokenization Protocol, investors will be able to participate in the decentralized crowdfunding. It will allow them to send tokens to the STP network from their wallet and receive the new STP standard token automatically. To ensure the token’s diligence and veracity, all the transactions will be conducted on-chain, so that investors remain in full trust. The token in crowdfunding will be run by STP protocol under the compliance of particular jurisdiction. 

#4 Peer-To-Peer Operation

STP Protocol enables peer-to-peer token transfer without the interference of any third party. Disintermediate transfer of assets is the core feature of the STPT network. With the help of an on-chain compliance validator, it has ensured that all the transactions are conducted with respect to the pre-programmed regulation of the issuer. This way, STP Standard makes sure that the parties transact between one another without depending on the third party while checking the compliance simultaneously. You cannot find this particular feature in the traditional financial world. Hence, the popularity of STPT is growing each day. 

#5 Strengthening Financial Products

The tokenization of assets can prove beneficial for financial products in a compliant manner. Also, it will allow the creation of new financial products as well. For instance, with the use of STPT for wine collection, tokenization will allow the owner to use STP Standard token as a means of collateral for DAI loan. This way, the dormant or unlocked value struck in the valuable assets can be put to good use in other ways. 

The Bottom Line

Decentralization of transactions has been made possible by the blockchain technology. The smart contracts are the tools that help in maintaining the accuracy and diligence in the ecosystem. Standard Tokenization Protocol is a decentralized smart contract platform that is meant to ensure the compliance of tokenized assets in jurisdictions across the world. 

It is a brand-new way of fundraising and issuance of the assets that are more diligent, accessible, compliant, fair, transparent, and safe. The platform envisions a digital tomorrow for the issuers, institutions, and jurisdictions. It is a new standard for tokenizing assets in the most compliant manner. 

Whether it is the issuance fee or the compliance validator, STPT network has not left any stones unturned when it comes to making the platform highly effective. There are plenty of benefits that make Standard Tokenization Protocol use-worthy; issuers can easily tokenize their assets without worrying about blockchain platforms’ regulation in different jurisdictions. 

An increased volume of STPT use cases will allow the users to tokenize their assets in the most compliant manner. The above mentioned were all the nitty-gritty details about the Standard Tokenization Protocol that will help you understand it better. You can also read the whitepaper or visit https://stp.network to get more details about this smart contract platform’s relevance. 

Wondering about other coins and tokens? Quench your educational thirst here.

Post Author: Nowpayments.io