- Transfer Agent Vertalo has asked its customers to use the Tezos Blockchain instead of the Ethereum Blockchain.
- Ethereum will continue to be supported, but in the future, clients should issue securitiy-tokens on the Tezos blockchain.
The Transfer Agent Vertalo announced that the Tezos Blockchain will be the standard blockchain for the company processes in the future. So far, the company has used the Ethereum ecosystem to implement all services. However, a new update makes it possible to convert ERC20 tokens into Smart Contracts in the Tezos format, with Ethereum still being supported.
Based in Austin, Texas, Vertalo currently serves 18 customers and issues digital securities and manages data for exchanges, broker-dealers, issuers and custodians, all of which the company links together. The platform also enables the tokenization of stocks with the REG D V token, with a particular focus on start-ups seeking to raise additional capital through this measure. CEO of Vertalo, Dave Hendricks, describes:
We think that that covers 99 percent of the security token and smart contract landscape for equity and debt.
Vertalo switched to Tezos because the Tezos blockchain offers higher transaction rate (transactions per second) and greater scalability. Furthermore, smart contracts can be developed in several programming languages. In addition, the security of the network is higher. Some industry experts, such as Jesus Rodriguez, see the Ethereum blockchain as one of the biggest technological contributions of the century.
However, Ethereum has significant disadvantages in the area of token protocols compared to other competitors such as Tezos. According to Rodriguez, the Tezos blockchain provides a better and more stable security token infrastructure than ETH. He explains:
The fundamental limitation that makes Ethereum a painful choice for security tokens can be expressed as the friction between transactions and asset ownership. Ethereum is a very powerful platform that is fundamentally optimized for one use case: transfer a crypto-asset from point A to point B. The behavior of security tokens, on the other hand, is fundamentally dictated by dynamics related to asset ownership that have little to do with transaction mechanics.
Rodriguez states that when programming smart contracts on Ethereum in the field of security tokens, disproportionate “coding efforts” are required to implement all the important functions. Although 94% of security tokens (STO) are currently launched on the Ethereum blockchain, Tezos seems to be establishing itself as a worthwhile alternative.
Tezos is becoming increasingly popular with companies
As we reported earlier, Andra Capital, in cooperation with Tezos, will launch the Silicon Valley Coin on the Tezos blockchain and will issue it through TokenSoft. Sam Raman, Head of Strategic Alliances, was pleased with the upcoming collaboration:
The TokenSoft platform provides the technology for qualified retail investors to participate in desirable, late-stage, pre-IPO technology venture companies, and we have partnered with the best-in-class providers including the Tezos Foundation for its expertise in digital securities for the Silicon Valley Coin offering.
The German securities tokenisation platform Fundament announced a few days ago that it will use the Tezos blockchain for issuing tokens. In addition, tZERO will tokenize luxury real estate through a partnership with Alliance Investments. The company plans to offer properties with a value of over 25 million USD per property. A total volume of USD 640 million is to be tokenized via an STO in the first quarter of 2020.
It remains to be seen whether Tezos can actually establish itself as an alternative to Ethereum in this area. The price of XTZ has risen by 3.42% within the last 24 hours, to a price of USD 1.51.