Karma SME loans exchange will be the first company to convert utility tokens offered through an ICO to the tokenized equity on the Tokenomica platform.
The utility-to-security swap will allow Karma token holders to become shareholders, providing a whole range of corporate rights including equity ownership, profit-sharing rights, voting rights, rights to sue for wrongful acts and much more. Еquity issuanсe will allow Karma to build a compliant “company-shareholder" relationship model, increasing the overall reputation of the company and ensuring the trust of current token holders.
Another significant benefit of the swap is the effect on the price of the asset. Currently, the price of utility tokens is heavily tied with the highly-volatile crypto market, while tokenized equities are tied strictly to the key financial indicators of the company and not depend on crypto market fluctuations.
“Karma business is growing 40% each month for 10 months in a row. We’re on our path to self-sustainability and operational profitability. However, due to the major fall of the crypto market, the price of an asset offered during the ICO has significantly decreased. There is a paradoxical situation: the business is growing at a tremendous pace, while investors can’t benefit from our growth. To heal this situation, we’ve decided to perform a utility-to-security swap offered by Tokenomica” — George Goognin, Founder and Board Member of Karma.
The swap will be managed via the Tokenomica platform. According to Tokenomica’s CEO Artem Tolkachev, the proposed model will help successful ICO projects to raise additional capital and will provide investors with an appropriate level of legal protection and guarantees.
“So far, the framework of ICOs has proven to be more beneficial for companies than for investors.
The utility-to-security swap restores the balance of interests. Investors become full-fledged beneficiaries of the company, while the company increases its investment attractiveness and strengthens its reputation in the market. It also helps to clear the ICO stigma and to raise new capital both from institutional and retail investors.
We will be glad to manage this case with Karma ” — Artem Tolkachev, Founder and CEO of Tokenomica.
Tokenomica is an EU-based financial platform for issuing and trading of smart securities, allowing investors to invest in fundraising campaigns, combining the best elements of traditional financial markets and technology.