- Security trading platform, Openfinance, will delist all tokens and suspend trading unless issuers offer funds to cover its costs.
- In case it does not receive enough funds, it will delist all the tokens on May 21 and stop trading.
- The company has clarified that securities will continue trading.
Openfinance, a security trading platform, has said that it will delist all the tokens and stop trading unless issuers offer funds to cover its costs. According to a CoinDesk report, the transaction activity on the trading platform has not increased fast enough to cover its operating costs. In an email sent to the alternative trading system’s (ATS) users, Openfinance has asked issuers with tokens listed on the site to cover these costs with new contracts. In case it does not receive enough funds, it will delist all the tokens on May 21 and stop trading.
The email clarified that securities will continue trading. However, the number of traditional instruments that Openfinance actually lists is unclear at the moment. An excerpt from the email reads:
We have asked the issuers currently listed on the platform to renew their listing agreements and cover a portion of our costs, including through annual listing fees, as are common in large, public markets, where issuers pay exchanges for listing services.
In August 2018, Openfinance launched its ATS, allowing accredited investors across the world to buy and trade security tokens. Kyle Sonlin, CEO of Security Token Market, told CoinDesk that Openfinance shutting down its security token platform would be “a loss for the industry.”
It’s worth noting, however, that these security tokens can simply be self-custodied and eventually moved to another platform, which is a testament to the functionality and efficiency of security token technology.
In the email, Openfinance noted that securities would not experience any disruption in ownership. It also added that users could transfer security tokens directly to buyers and sellers. User funds will be maintained at Evolve Bank, an FDIC-insured institution in Arkansas.
We remain hopeful that existing listing agreements will be renewed and any delistings can be avoided. If that is not possible, we will work with our issuer partners to minimize any disruptions and Openfinance will move forward, continuing to enhance its efforts to improve secondary market trading of digital (non-tokenized) securities on our ATS.
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