1.1 Equity and Debt Instruments

Introduction

Companies that raise equity through traditional methods can experience issues such as the need for frequent bookkeeping, slow settlement periods, and the manual process of issuing and signing stock certificates. Tokenization alleviates these issues, allowing companies to manage investors and responsibilities from a digital platform, attract a new type of investor, and automate compliance obligations. Moreover, debt products require regular dividend payments, but long settlement times and manual processes can delay the issuance process. Additionally, middlemen can add to the problem by charging high fees for their services. Tokenization helps debt issuers reduce inefficiencies by automating the process.

In addition to the benefits of tokenization, Decentralized Autonomous Organizations (DAOs) and smart contracts can ensure repayment and facilitate the process of forced liquidation.

Workflow