Tokenization Asset Platform

FAQs
Glossary

Getting Started with TAP

As an Issuer, first successfully register to TAP and get verified for the Information of your company and on approval begin the token creation process.

As an Investor, first successfully onboard (register and login) to TAP, accept the terms and conditions and electronically sign the documents, get your Compliance done and then invest.

The Accredited Investor must be high net worth individuals whose income exceeds either $200,000/year (for single persons) or $300,000/year (for married couples) or a net worth exceeding $1,000,000 (excluding the value of their principal residence)

TAP uses an industry leading Know Your Customer (KYC) service. The service uses a unique database of digital identities and through some of the 30+ vendors integrated into their platform, confirm identities and raise flags on suspicious applicants.

TAP offers different types of securities such as Equity, Bond, Real Estate and Funds currently under Regulation D and Regulation S. Very soon we are launching Reg A+ and Reg CF for US Investors.

To invest in Reg D Tokens you have to be a US citizen and accredited investor.

Regulation S requires that the investment offer and sale must be made to investors that are outside the U.S and U.S. investors must not be shown the non-U.S. investor terms. There is no required S.E.C. registration for Reg S offerings, but methods and good practices must be followed. An attorney that writes a Private Placement Memorandum (P.P.M.) and Subscription Agreement for offering - this describes the investment in legal and financial terms.

Tokenization

Self-executing contract stored on blockchain technology with terms and conditions embedded in the security that controls the transactions between the parties. Smart contracts create an added layer of transparency and efficiency to make transactions automated.

Security token as an asset converted digitally using blockchain technology in a compliant way. Some examples are equity, bond, real estate, funds converted to a security token deployed on Ethereum mainnet.

Custodians are the Third-party Service providers that supervise and guard the security tokens representing the legal owners of the digital assets. Custodians thus minimize the risk of thefts or any other loss.

The business firms who want to issue security tokens must comply with KYC/AML regulations and federal laws. AML or the Anti-Money Laundering regulations are the regulatory compliances that help to trace and report any financial suspicious activities that include money laundering, securities frauds, heists, market manipulations, or even financing the terrorists among others.
KYC or Know your Customers are an integral part of the AML regulations that include the verification of the customer’s identity and other essential details before offering him financial services.

Security is referred for assets including currency notes, bonds, treasury stocks, security futures, options, transferable shares, and investment contracts.

Primary platform Securities are created in the primary issuance platform. Firms first offer their new stocks and bonds. To raise money for operational expansion or company upgrades, corporations and governmental bodies offer fresh issues of common and preferred stock, corporate and governmental bonds, notes, and bills on the open market. There are strict regulations that apply to all concerns. Before offering securities for sale to investors, companies must submit paperwork to the Securities and Exchange Commission (SEC) and other securities regulatory bodies for approval. Tokenization Asset Platform is the primary issuance platform for issuers where issuers can raise capital under Regulation D, Regulation S, Regulation A+.
Secondary platform The secondary platform is the financial market where securities like stock, bonds, options, and futures that have already been issued are bought and sold. The original issuers of the securities do not get involved in trading them when they are exchanged on this platform. Even the asset prices are determined by how well they perform in the market and are in no way influenced by the name of the issuing firm.

The difference is quite clear about these two terms. The difference lies in the physical location of the assets. Tokenization of the ownership of the real asset doesn’t mean that the physical location of the asset is shifted physically by which the token is backed.

Soft Cap and Hard Cap are the goals that are aimed during the fundraising process in STO or ICO projects.
The soft cap is the minimum amount of money or lower limit of the amount to be raised and the Hard Cap is the maximum or absolute upper limit of the amount to be raised during fundraising.
If the ICO or STO project receives the amount more than the hard cap, the excess funds are returned to the investors. If a project doesn’t reach the soft cap, then the project might be considered as a failure but still, funds are returned sometimes. However, there is an ambiguity in soft cap terms and conditions of ICOs.

An asset-backed token can be a financial instrument or a service or a financial product. Asset-backed tokens are controlled within an accounting system where they are stored, managed and issued by the service provider or by the organization that stores physical goods like banks.
Each token represents a fixed amount of goods or services in the 1:1 ratio that is guaranteed by the custodian entity.
For example, One token may represent 1 gram of gold, one square meter of a real estate property, or even 1/1000 part of any precious art piece.
If the underlying asset is considered a security, the token can be categorized as security token.

A B D E F I K L
O P R S T V W

A

You are considered as an Accredited Investor if

1) You have an annual income exceeding $200,000, or $300,000 for joint income, for the last two years with expectation of earning the same or higher income in the current year and must have earned income above the thresholds either alone or with your spouse over the last two years.

2) You have a net worth of over $1 million, either individually or jointly with your spouse,

Anti-money laundering (AML) refers to a set of laws and regulations that pressurizes the financial companies to monitor all the clients to prevent money laundering and corruption. AML regulations require financial institutions to monitor customers' transactions and report on suspicious financial activity. At Tokenization Asset Platform, the Compliance (KYC, AML/CTF)of the Investor is one of the key components to the company AML program.

Asset Class

An asset class is a group of securities/investments that have similar characteristics, and are subject to the same laws and regulations. For example, asset class can be equities, bonds, real estate, commodities etc.

B

A blockchain is a chain of blocks, which are digital pieces of information, that are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data which are immutable.

A broker-dealer (B-D) is a person or firm in the business of buying and selling securities for its own account or on behalf of its customers.

Broker Dealer is a person or firm that buys and sells the securities (In crypto format) for its own account or on behalf of its customers.

D

Dividend Distribution to the token holders refers to providing a percent share of the total dividends to the particular wallet addresses may be in the form of capital distribution of tokens or interest payment to the investors.

E

Ethereum is a decentralized open source blockchain featuring smart contract functionality used for its cryptocurrency Ether. Ethereum is also a programming language running on blockchain that allows to build distributed applications.

F

Tokenizing the asset and fragmenting into fractions paves the way for Investors to access high value assets by acquiring a fractional ownership of those assets.

I

Issuer

Someone who wants to tokenize the assets, create tokens and sell on the Tokenization Asset Platform

K

KYC (Know Your Customer)

The Know Your Customer is a standard in the investment industry that ensures investment advisors know detailed information about their clients' identity, risk tolerance, investment knowledge, and financial position. KYC is one of the identity verification processes at TAP.

L

A legend is a statement on a token certificate noting restrictions on the transfer of the tokens.

O

To sell the restrictive securities to the public a legend has to be removed from Token either by a transfer agent or Issuer who issued the Token. To remove legend, the issuer has to consent usually in the form of an opinion letter from the issuer’s counsel.

P

Investor transfer tokens from his personal wallet to another person’s wallet

Issuing tokens for the first time by the Issuer or BD on behalf of the issuer

A Private Placement Memorandum (PPM) is a legal document that states the objectives, risks, and terms of an investment involved with a private placement. This document serves to provide buyers with information on the offering and to protect the sellers from the liability associated with selling unregistered securities.

R

Regulation D

Regulation D (Reg D) is a SEC regulation governing private placement exemptions. Regulation D (or Reg D) contains the rules providing exemptions from the registration requirements, allowing private companies or entrepreneurs to offer and sell their securities without having to register the securities with the SEC. A Regulation D offering is intended to make access to the capital markets possible for small companies

Regulation S demands that offers and sales of the securities (tokens) be made outside the United States and that no offering participant (which includes the issuer and their respective affiliates) engage in "directed selling efforts". The regulation also requires that no offers and sales be made to U.S. persons

Rule 144 is a regulation enforced by the U.S. Securities and Exchange Commission (SEC) that sets the conditions under which restricted, unregistered, and control securities can be sold or resold.

S

Secondary Market

Where tokens can be traded on the Crypto Exchange

Security tokens are the digital representation of traditional financial instruments. They represent a financial interest in the issuer of the security.

A self-executing contract stored on blockchain technology with terms and conditions embedded in the security that controls the transactions between the parties. Smart contracts can have functions for automatic transactions, formulas for calculating asset prices, are capable of facilitating an exchange of money, and other specific features.

T

Tokenization

Tokenization is the process of converting an asset into a token on Blockchain programmatically, reducing the need for manually issuing, managing, and trading the private securities along with regulatory requirements.

A transfer agent is a trust company or similar institution assigned by a corporation for the purposes of maintaining an investor's financial records, tracking each investor's account balance, managing voting events and distributing dividends.

V

Certain amounts of tokens that are held aside for some period of time for the team. Smart Contract usually locks a certain amount of tokens until Contract conditions are met.

W

A wallet address, comprising a string of 26-35 alphanumeric characters, is all it takes to send and receive cryptocurrency. Any address can be used to transfer cryptocurrency to any other address on the network, provided the sender's wallet software supports that address type.

Get Started!

Get Started!

Get Started!

Get Started!

FREQUENTLY ASKED QUESTION

Getting Started with TAP

How do I become an issuer on the TAP?

How do I become an investor on the TAP?

How do I know that I am an accredited investor?

How does TAP handle investor identity verification?

What type of investments TAP offers?

Who can invest in Reg D tokens?

Who can invest in Reg S tokens?

Tokenization

What is a smart contract?

What is a security token?

Who are the custodians and what do they do?

What are KYC/AML regulations and how are they relevant to securities offerings?

What is meant by security?

What are the Issuance platforms?

What is the difference between the ownership of a real asset and ownership of a token supported by that asset?

What is Soft Cap and Hard Cap?

What are asset-backed tokens?

A

Accredited Investor

Accredited Investor

AML

AML