Everything You Need To Know About Tokenizing Your Assets For Your ETO Development
Author ETO Development
Digitization is the key factor that is forcing us to adapt to several changes around us. One such instance is the tokenization of assets to raise funds. Earlier fundraising activities were quite challenging for companies as they had to convince their investors to invest their funds in the company. But now, with the advent of technology, you can tokenize your assets and provide security tokens for your investors. ETO or Equity Token Offering is an advanced version of ICO for fundraising where the investors will buy Equity tokens from the host companies.
Is your new project ready to go on floors? Then why not start your fundraising campaign with our Equity Token Offering service? Gather every bit of information about it from this piece of blog.
What is an Equity token Offering?
After several encounters with digitization, now it’s time to tokenize your assets to raise funds from your investors. Fundraising is not something, and it has been in action for years. But the channel and medium through which it was organized have alone been changed. By now, you would have heard about ICO and its role in crowdfunding, and ETO is a bit more advanced and technical than the former. The major goal of ETO is to raise funds through share dilution.
Equities or shares of the company can be tokenized, and the assets will remain as digital tokens that can be stored online. The companies that are in plan to expand their operations or in the ideas of launching their new projects can opt for Equity Token Offering(ETO).
How are assets tokenized in this process?
In ETO, the first step is to digitize the assets of the companies like their bonds, ownership, and investment capitals into digital tokens. These tokens are created and stored in the blockchain. These tokens will have an individual value that can be used as a tradable product.
When tokenizing the assets, it increases the trust factor among the investors to invest in your company. These tokens are created and maintained in the blockchain, and this assures the investors with investment security. The company’s shares, equities, and assets of a company are converted into tokens that can be maintained in smart contracts and blockchain to raise funds.
How about meeting our expert team for a discussion?
Connect on WhatsApp What are the different types of Equity tokens?
When it comes to equity tokens, there are two different types of tokens,
-
Dilutable tokens
While creating the tokens for the company, you are entitled to create as many tokens as you want. But while distributing them to the investors, you will save for selling in the future. When all these unused tokens are sold to the investors, the stakeholders will dilute the shares. Along with the development of the company, these tokens will lower the amount of stock held by the investors. However, the value of the stocks will still be high.
-
Non-dilutable tokens
Here, the tokens are equal to a percentage share of the company. The investors will hold their percentage of shares from the company as long as their token remains in their wallets. The investors will get their anti-dilution premium insurance to remain in the company without diluting their shares. In this type, they would get their future benefits a bit in advance. In most cases, dilutable tokens are much preferred over non-dilutable tokens.
Exponential benefits of opting for an Equity Token development
There are several underlying benefits in opting for ETO development services. Let us have a brief overview of it,
Transparency
As you all know, blockchain is known for creating and storing data in a secure network that can never be accessed by anyone. The decentralized platform is open for all the users where they can have information about each transaction of the tokens. Through this, they can know the owner and various details of the tokens. This gives a sense of trust for them to invest in your company.
Immutability
The ETO built-in support of smart contracts and blockchain makes it completely safe for the investors to access information about the tokens effortlessly. There are no grounds for manipulation in blockchain, and no one ever could try to replicate or create duplicate tokens for the already existing tokens.
Higher liquidity
The blockchain network has now become a reputed forum as all industries have adapted them. So, here anyone can create their tokens and sell them to anyone at any time. The platform will deal with the tokenization of all liquid assets such as real estate, antiques, artworks, cars, private company interests, etc. The platform will identify the areas where people get blocked and provide greater liquidity.
Cost-effective
Opting for ETO literally saves time and cost as it connects the owners and buyers directly without any intermediaries. Sometimes, the intermediaries also create certain problems in between the funding because of which the activity gets interrupted. They eliminate the involvement of middlemen and help you save the money you spend for those intermediaries.
Partial ownership
ETO involves the companies dividing themselves by different assets and tokenizing them. Dividing the company into different segments will provide partial ownership for the investors and stakeholders. This will attract a lot of investors to the company and assure greater liquidity.
Wrapping up,
The emergence of digitization is paving the way for the birth of various other new concepts around us. One such concept is the introduction of ETO, where you can tokenize your assets and equity to raise funds. Appdupe, a numero uno ETO development company, offers the best-in-class Equity Token development services for organizations to conduct their fundraising. Contact us right away to discuss in brief developing your personalized ETO development.
Get started with us to develop your ravishing ETO
Marketing is my soul mate and writing is my side kick. Using my writing skills to share the knowledge of app development and upcoming technologies.
