Security Token Offerings

43 Pages Posted: 16 Jul 2020 Last revised: 22 Apr 2021

See all articles by Thomas Lambert

Thomas Lambert

Rotterdam School of Management, Erasmus University; Erasmus Research Institute of Management (ERIM)

Daniel Liebau

Erasmus University Rotterdam (EUR), Rotterdam School of Management (RSM); Singapore Management University

Peter Roosenboom

Rotterdam School of Management, Erasmus University; Erasmus Research Institute of Management (ERIM)

Date Written: April 22, 2021

Abstract

This paper shows that distinguishing security token offerings (STOs) from initial coin offerings (ICOs) is crucial for the study of entrepreneurial finance. We first provide a working definition of a security token and present an overview of the STO market using a unique STO sample. The STO activity developed after the end of the ICO market bubble. The STO market is, however, still a nascent market. STOs are geographically dispersed but concentrated in jurisdictions with accommodating securities laws. Next, we explore STO success factors. We show that various issuer and offering characteristics, traditionally used in the ICO literature, also matter for STO success. We also find that success is associated with good governance practices, consistent with the corporate finance literature. We conclude by discussing the implications of native digital securities, the next generation of security tokens, for entrepreneurial finance.

Keywords: blockchain, corporate governance, entrepreneurial finance, initial coin offering, native digital securities, securities laws, security token offering, tokenization

JEL Classification: G11, G32, G34, L26, M13

Suggested Citation

Lambert, Thomas and Liebau, Daniel and Roosenboom, Peter, Security Token Offerings (April 22, 2021). Available at SSRN: https://ssrn.com/abstract=3634626 or http://dx.doi.org/10.2139/ssrn.3634626

Thomas Lambert (Contact Author)

Rotterdam School of Management, Erasmus University ( email )

P.O. Box 1738
Rotterdam, 3000 DR
Netherlands

HOME PAGE: http://www.sites.google.com/site/lambertthom

Erasmus Research Institute of Management (ERIM) ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Daniel Liebau

Erasmus University Rotterdam (EUR), Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands

Singapore Management University

Li Ka Shing Library
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Singapore 178901, 178899
Singapore

Peter Roosenboom

Rotterdam School of Management, Erasmus University ( email )

P.O. Box 1738
Room T09-56
3000 DR Rotterdam
Netherlands
+31 10 40 82255 (Phone)

Erasmus Research Institute of Management (ERIM) ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

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