DIGITAL ASSETS
It is not just enterprises keeping pace with the evolution of digital assets, but regulators as well. Recognising the need to modernise decades-old securities laws, the United States Securities and Exchange Commission( SEC) recently proposed a framework known as Regulation Crypto Assets. This tailored regulation provides definitive legal exemptions for companies issuing investment contracts through digital tokens. It offers a US $ 5m start-up exemption for enterprise contracts involving crypto assets, alongside a further US $ 75m 12-month fundraising exemption for crypto projects. For the first time in the history of digital finance, traditional businesses have a clear, fully compliant runway to raise capital using tokenised assets without blurry legal boundaries creating the risk of sudden enforcement actions.
For the modern fintech enterprise, this newly regulated blockchain-powered ecosystem offers immediate operational and financial advantages, such as the shift towards 24 / 7 settlement over traditional banking. The latter of such requires batch processing, operating strictly within business hours and shutting down entirely over weekends and holidays. Countering this, digital assets run on continuous networks which never close due to running on decentralised computer networks and software code rather than manual human operators. This round-the-clock leap enables atomic settlement, the instant and simultaneous exchange of an asset and its corresponding payment.
“ The complete key is never assembled in one place, at any point in time. The result: no single compromised device, insider or attacker can access your funds”
BlackRock
Consequently, international trade, cross-border corporate remittance and complex treasury rebalancing can occur safely at any time of the day.
Beyond speed, digital assets also introduce programmable treasury operations through the use of smart contracts. Smart contracts are selfexecuting lines of code which are stored directly on a blockchain. Businesses can leverage this technology to automate the majority of their financial administration. These contracts automatically execute value transfers using stablecoin, process fund subscriptions and manage dividend distributions without requiring manual hand-offs or intermediary approvals, cutting back-office overhead and their associated intermediary fees.
fintechmagazine. com 111