When it comes to crowdfunding you have plenty of options, especially debt peer-to-peer financing, and it seems like they continue to increase all the time. But when you’re looking to venture into specific areas like equity crowdfunding with decent dividend yield, you’ll want to take a closer look at Fintelum, because that’s exactly what this crowdfunding platform is designed to assist with. And it’s doing a great job at freshening up this capital markets sector, by including cryptocurrencies and tokenization into the equation.
What is Fintelum
As mentioned, Fintelum is a crowdfunding platform that can (and should) be used by high-growth businesses as well as real estate projects that are sourced within Latvia and Europe. It’s fully compliant with all European KYC/AML laws and yet provides an alternative to traditional methods of investment. This is true for both primary issuance and secondary markets with global participants. Through it’s participation in cryptocurrency, Fintelum is able to encourage global participants to invest using fiat and cryptocurrencies. Plus, the system uses blockchain for equity and utility token issuance. The company, overall, has a unique value proposition both to issuers and investors looking to get into investing in new ways, with sizeable returns compared to traditional listed equities.
The system is designed to tokenize assets as well as developing and supporting utility or security tokens. If you’re issuing tokens you get to choose between security and utility tokens. The utility tokens are EIP-20 or ERC-20 while the security tokens are Fintelum Security Token Implementation Standard. All of this makes sure that the process is secure for those on both sides of the arrangement. They’re part of the reason that Fintelum is considered one of the top technological issuance platforms. And they have a lot of features like integrated AML/KYC compliance, aftermarket transfer agency and secondary token OTC desk functions and corporate action services.
How Fintelum Works for Investors
For those who are ready to get started investing you have to know how to do it with Fintelum. The good news is that it’s actually quite simple to do. You just need to start out by creating your own account and registering it so you can invest. Once you’ve done that, you’re ready to start taking a closer look at the projects that are currently available with the system. These projects are all vetted and may well be profitable for you. But of course, that’s your own decision to make.
You’ll need to provide KYC/AML compliance information one time for the first project you decide to invest with, but the information can then be reused for any other projects you want. Plus, you just have to wait to be whitelisted and you’ll be able to get started with the investment process. You’ll be considered a secure investor and all of the investments you make will be better secured as well. And those two steps are all it takes for you to get started investing in projects. From there, it’s all about turning a profit and you can do that in several different ways.
For one thing, you can hold out with your investment for as long as you want, while receiving regular dividends or interest payments. You may be able to realize a great profit by holding out. Or you could trade or exit projects whenever you choose. Selling tokens can be done at the P2P trading desk through Fintelum. Keep in mind that your project issuer will need to be opted in for secondary market in order to offer tokens on the P2P trading desk. If they have, you’ll be able to post interest to sell your tokens or even buy some more if you want to get a bigger stake.
These options are great for letting you see a profit, get a larger stake or get out of a project that you don’t want to be a part of anymore. And you’re able to get started with them whenever you want, which is going to make it easier for you to get the results you’re looking for. But of course, part of the way you’re going to make the best profits is by holding out on some of your investments or at least knowing when you should hold out and when you shouldn’t. And that requires you to monitor your portfolio.
The fourth and final step in the process of using Fintelum is exactly that, monitoring your portfolio. You’ll want to use your investor profile to see which projects you’re invested in and at what kind of stake. You can see how your invested projects have been doing, read their management report and look into their financials and make your own predictions about what’s coming next. Not only that but if there’s an affiliate program for that particular project you’ll be able to enroll directly on your profile. This will give you an even bigger profit from your projects and definitely makes it worth investing and keeping an eye on how things go.
Invest in 4 Easy Steps
Provide your basic information and you can proceed to choosing your project.
- Choose your project
From a list of vetted projects, select ones that you find exciting and profitable to invest in. Provide your KYC/AML compliance information once and re-use it for all other investment projects. Once you are whitelisted as an investor, you can proceed to investing securely.
- Trade or exit your projects
Sell your tokens, or acquire new ones with the help of Fintelum P2P trading desk. If the issuer has opted for secondary market, the tokens are offered on the P2P trading desk, and you can post your interest to sell or buy more of the listed tokens.
Monitor your portfolio
Follow your portfolio on Fintelum Investor Profile. You can access reports on your investment history. If a project has affiliate program, you can enrol directly from your profile and profit further from each project offering.
How Fintelum Works for Issuers
When it comes to issuing tokens there is actually a five step process that you need to follow, but Fintelum makes it as simple as possible. It all starts with figuring out what type of token you’re going to be issuing. You can choose between security, utility or hybrid tokens. Once you’ve determined the type of tokens you’re going to issue you can take a look at the requirements for an enterprise to start selling. You need to have at least two out of the six qualifications of: idea, team, proof of concept, existing business, paying clients and minimum viable product.
You will then need to choose the jurisdiction for your product, which means the location that you’re based out of. From there, you can also choose the area that your investors are most likely to come from. And you can decide on the method of communication you’re going to use for your community of investors. If you’re going to be a local project this might be easier than if you’re considered global, but you can still create an effective outreach program and communication strategy with either of these options.
Finally, the last step is actually one that Fintelum takes over on its own. In this step, all of the rest of the aspects of the process are taken care of. This includes KYC/AML compliance, crypto custody & escrow, security & utility tokens, token transfer agency, secondary P2P trading and STO implementation. And all you have to do is sit back and let Fintelum take care of it all. You get to do the work of running your business and not have to worry about all of the behind the scenes stuff that goes into running your investment process.
Safety and Security
In order to keep those on both sides of this process secure, Fintelum requires KYC/AML compliance, registration, and smart contracts. By executing smart contracts on the blockchain it is possible to ensure accurate records of all transactions. This is better for the investor and for the issuer as it ensures proper control and accurate funding. Not only that but the entire process through Fintelum requires a compliance check and registration and whitelisting before investors are able to invest. This protects the issuer from a fraudulent process or an investor who is not looking out for the right reasons.
Fintelum also makes sure to protect the issuer, by issuing share-tokens once the crowdfunding is complete and when participants and their funds have been verified. This is also smart because Fintelum protects the issuer within the issuing country’s legal framework, by using this process. Once the funds have been verified, the smart contract is created and tokens distributed to all stakeholders on their Fintelum accounts. If Fintelum is dealing with share-tokens that are enabled for secondary markets, then they can be exchanged internally or externally. When external transactions take place, Fintelum also ensures that only those authorized, will be able to lay claim to the tokens. They do this by recording it on the blockchain, so it can be review whenever necessary.
Also, people often forget that a security token is just a cryptographic representation of an agreement. The security token represents a legal agreement/contract between two or more parties. Therefore the token itself should not be considered an object of the agreement, but just a mere representation of the terms made within the agreement. Another good thing about The Fintelum STO implementation is that it’s built on the Ethereum blockchain. Fintelum has chosen that due to the security and robustness of the Ethereum blockchain. To make things even better, If the Ethereum blockchain fails for any reason, the token can be replicated on other blockchains, following the same business and legal requirements. This makes the Fintelum STO implementation chain agnostic, which give you a extra feeling of safety.
What’s New With Fintelum
When it comes to the features of this platform there’s more available than you might think. And there’s more coming all the time. In fact, Fintelum has recently opened investments into a new tokenization project known as KEEPP. This share company is actually registered in Latvia and is the very first STO project to be listed on the tokenization platform through Fintelum. Of course, it’s expected to be only the first of many and to provide representation through the Ethereum blockchain. In order to achieve total project funding it will need EUR 850,000.
For individual investors and corporate entities, offerings and investments are allowed, with investors able to purchase dividend-paying preferred shares of the system at only EUR 2.50 per share. This gives them the right to dividends that are estimated to be approximately 15% per annum. All of this means that it’s a great investment opportunity for those who are looking to maximize their opportunities by getting involved in something new in the cryptocurrency realm. And that’s only the beginning of the process between Fintelum and KEEPP, with direct investments into share capital also provided, and without the need for any traditional special purpose vehicle structures. Instead, KEEPP provides even more.
In fact, KEEPP provides direct investment into short and long term storage businesses and provides innovative asset allocations within Europe. This offers a great investment opportunity for the investment environment, especially with the current market and the way that COVID-19 has caused overall disruption. It means that there is a new opportunity that investors are likely to be drawn to simply through KEEPP on its own. But with Fintelum and the offerings that it has within this investment it’s even more possible for investors to maximize the offerings.
In investing with KEEPP, it’s important to note that this is offering an equity token in the company. Currencies that can be utilized include EUR, BTC and ETH and the price per share is EUR 2.50. This can be converted to the other accepted currencies. Also, the minimum investment is EUR 50, or 20 shares, with a maximum investment of EUR 100,000. This is out of a minimum amount of funding of EUR 350,00 and a maximum of EUR 850,000. Even more, the tokens are expected to provide a return dividend of 15% and a float ratio of 50%.
Understanding Security Token Offerings
An STO, or Security Token Offering, like the one being offered here, provides investors with an opportunity to invest fiat or cryptocurrency to purchase a security product. The product is regulated and is ‘provided’ in the form of a cryptographic token. This is possibly an equity token, a debt token, a hybrid token or a derivative asset token. No matter which type it is, it’s bound by securities laws as well as crowdfunding laws and it all has to be done according to the rules that are laid out in the offering document as well as Europe’s KYC/AML processes.
The Overall Experience
Working with Fintelum, either as an investor or an issuer, is a way to achieve the benefits that you’re looking for out of the investment process. If you’re an investor you want to make sure you’re investing in quality products that are going to get you a good return. If you’re an issuer you want to make sure you’re getting the opportunity to get in front of even more investors. Fintelum is designed to provide you with both of these opportunities and to ensure that the future of fundraising and investment is coming now.
In fact, Fintelum believes that ICOs, STOs and tokenization of assets are the future and that they are going to provide a new opportunity for capital markets and fundraising. As a result, they work to provide a completely compliant token sale process that makes things as simple as possible for all participants and issuers. That’s where you can come in. No matter which side of things you’re on, you’ll find that working with Fintelum is definitely the way to go and it’s only getting better as the company continues to grow and improve their offerings.
You can find Fintelum’s whitepaper here.
Disclaimer: This article is not intended to be a source of investment, financial, technical, tax, or legal advice. All of this content is for informational purposes only. Readers should do their own research. The Capital is not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by reliance on any information mentioned in this article.
Fintelum Review 2021: What You Need to Know About Fintelum was originally published in The Capital on Medium, where people are continuing the conversation by highlighting and responding to this story.