Discussion on STO and the Policy Environment of the Encryption Industry

Recently, Coinbase announced the relaunch of its stock tokenization plan, sparking a new round of attention on STO (Security Token Offerings). In this episode, we invited the founder of dForce, Ren Dao, to have an in-depth discussion on the development prospects of STO and the current policy environment in the encryption industry.

The Value Proposition of STO

The civil path believes that the main value of STO lies in:

1. Expand the fund pool from regional markets to global markets
2. Improve the efficiency of capital utilization, reduce settlement time and costs.
3. Stock equity expansion, from a simple shareholder certificate to a multifunctional usage certificate.

He particularly emphasized the empowerment potential after the tokenization of stocks. Taking Coinbase as an example, its tokenized stocks may be used for staking, validation, and gas payment on the Base chain in the future. Other companies like Disney and Netflix's tokenized stocks may also integrate with their products and services, providing additional rights to holders.

Challenges Faced by STO

Despite the broad prospects, STO still faces many challenges:

1. Regulatory compliance issues, especially the coordination of cross-border regulation
2. Product design, such as whether to restrict KYC users from purchasing
3. Market demand, early attempts at trading volume are generally low.
4. Issuer's credit, can it guarantee the redemption of underlying assets?

Mindaodao stated that the STO market is currently in a phase similar to the early stages of DeFi in 2017-2018, and still needs time to develop and improve.

Potential Beneficiaries of STO

The public believes that the biggest beneficiaries in the wave of STOs will be the asset issuers, especially the leading issuers that can quickly scale and create network effects. They can profit by charging various fees and through derivative businesses. As for the choice of issuance chain, he suggests referring to the strategy of USDT, issuing on multiple chains based on demand.

Current encryption industry policy environment

Regarding the recent policy changes, the people expressed a complex view:

• The series of favorable policies introduced by the Trump administration exceeded expectations, but most were implemented through executive orders, lacking long-term stability.
• Some operations of the Trump family ( such as issuing coins and the World Liberty project ) have raised concerns about the misuse of public resources.
• The encryption policy is too closely tied to Trump's personal interests, which may lead to future policy fluctuations.
• The market has doubts about the long-term sustainability of the policies, affecting recent performance.

The public calls for attention to whether these policies can truly be solidified into law in the future, and how the encryption industry can balance political support with independence. He believes that excessive reliance on the support of a particular political figure or camp may undermine the anti-fragility of cryptocurrencies and be detrimental to long-term development.