Hey everybody, it’s me again, Adam Chapnick, and I am at the Security Token New York City Meetup brought to you by who, of course, the Security Token Academy. And I got the whale of the day, we have the legend himself, the OG, Bruce Fenton. Thank you for taking a minute to talk to us.
Thanks very much. That’s quite an intro.
We’ve been asking everybody what is a security token, and there’s something kind of hilarious and wonderful about me asking you, “Hey, what is a security token?”
First of all, security is basically an agreement. It’s an agreement for people to have an investment contract of some sort that says if I give you something, you’re going to get X for that in exchange for this thing called a security, which might be a share. All a token does, is takes that agreement that’s made in the real world by human beings and references something that is on a blockchain like a token, and that’s what a security token is.
Got it. Okay. And how are you involved in the security token world right now?
I’ve been focused on it for a long time. Probably earlier than most people, ...
I would agree.
... five years or so. Because I came from this business and then I got into blockchain Bitcoin business early, so I wanted to combine the two. So I’ve done a lot of investing through investment fund and serving on some boards and then our own startup working to be an asset manager that’ll work in tokenized securities as well.
Amazing. Knowing what you know from a very unique perspective, and like you said, you’re one of ... that’s why I say, you’re the OG. What do you think is exciting right now? It’s sort of an explosion of at least in conversation about security tokens, but from your perspective, what’s the most interesting thing going on right now?
The explosion in interest is really huge because I knew this was coming for a long time and now it seems confirmed. When you have big companies like Coinbase moving into this area, it seems like it’s a real thing. So there’s been a lot of debates that fell on my Twitter for years. I’ve been arguing with people, “Can it be done? Will it be done?” And the other day I tweeted, “You may disagree, you may not understand why, you may not see the value, but it’s going to happen.” I see a lot of value. I think it’s going to be very significant and do a lot of things to help people with freedom, help the economy, make things more liquid, be great for trading. I’m just excited that people are talking about it. Now, it really does seems like it definitely will be a real thing.
Yeah. It really does. So in terms of any specifics around the things that you’ve been exposed to either in your travels or here today or anywhere else, are there any kind of applications that you think are the most interesting today, whether or not that gets more interesting later?
I can probably sum it up by saying there’s a lot of sort of Rube Goldberg machining in this, where there’s people trying to do things overly complex. Securities have been around for, in their current form, for 85 years or so. There’s a lot that can be done with the existing technology. The technology of Bitcoin and the blockchain technology that’s been inspired by Bitcoin has been around for a while. You combine that with the securities world, there’s a lot of kind of vanilla stuff, which I think is maybe more exciting than trying to reinvent the wheel. People having all of these very, very complex structures that may or may not make sense.
So just digitizing things as they are now will be a huge opening, the more the people are really appreciated.
Yeah. I think a $50 trillion market is good enough. I don’t think you really need to invent new stuff on top of that.
It’s a pretty good number.
Okay. So now looking into the Bruce crystal ball, let’s say 12 to 18 months from now, what are we going to be talking about?
12 to 18 months will be exciting because you will have fully operational exchanges that are trading securities tokens, and they will have pairs with Bitcoin and Ethereum and other crypto that exists now. I think they’re going to raise a lot of money just like ICOs did. There’s going to be a lot of scams. There’s going to be a lot of junk. But there’s going to be a lot of excitement. There’s going to be some good projects. And unlike many ICOs, the metrics of a security token can be anything. So you won’t be able to blanketly make a statement and say, “Oh, they’re all bad.” There will definitely be scams, but there is nothing to prevent a really, really high quality security from issuing a token. And if you believe in agreements, which is kind of the foundation of the economy and free market, if you believe in agreements, then you believe in securities. Agreements can be good or bad. There’s going to be some good ones. So, 12 to 18 months from now, you’re going to see them trading actively, and you’re going to see some good ones out there, and you’re going to see a lot of money flowing into this space.
Amazing. Well, I hope we can check in with you periodically until then to hear all of the most exciting things that are happening from springing forth from the head of the OG himself.
Great. Well, thank you very much.
Thank you, Bruce.
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