WEST PALM BEACH, Florida, April 1, 2019 /PRNewswire/ -- According to Wikipedia, digital currency (digital money, electronic money or electronic currency) is a type of currency available in digital form (in contrast to physical, such as banknotes and coins). It exhibits properties similar to physical currencies, but can allow for instantaneous transactions and borderless transfer-of-ownership. Examples include virtual currencies and cryptocurrencies and central bank issued money accounted for in a computer database (including digital base money). Like traditional money, these currencies may be used to buy physical goods and services, but may also be restricted to certain communities such as for use inside an online game or social network.
By definition, digital currency is as user-friendly as a silver dollar. But just like its hard-currency predecessor, once it's circulating in a real-world context, things can become rather complex.
Palm Beach attorney Laura Anthony has been working with crypto-clients since the inception of virtual currency. Her law firm, Anthony L.G., PLLC, has handled dozens of cryptocurrency clients. ALG has quickly established a reputation as one of the leading cryptocurrency law firms, and Ms. Anthony is now regarded as an authority in this new field of law. She is also the producer and host of LawCast, Corporate Finance in Focus, a contributor to The Huffington Post and authors numerous articles about digital currency on her blog site SecuritiesLawBlog.com.
Ms. Anthony was recently interviewed by Jeff Ramson, CEO of PCG Advisory Group as part of PCG's new media website, Digitalsecurities.com. Mr. Ramson is an entrepreneur and innovator with a proven track record of more than 25 years' experience on Wall Street providing strategic guidance for emerging public and private companies.
PCG is geared toward helping investors identify value where it is not most obvious by facilitating a dynamic flow of information between its clients and the financial community.
Jeff: I am Jeff Ransom, CEO of PCG Advisory. We are a full-service investor relations firm specializing in emerging growth companies and blockchain projects. Today I have the pleasure of sitting with Laura Anthony, the founder of Anthony PLLC, a top-notch securities and business transactions law firm based in Palm Beach, Florida. Laura, it's great to have you here.
Laura: Thank you Jeff. I'm glad to be here.
Jeff: Tell us a bit about your practice. I know you've built just a really phenomenal reputation and a great client base.
Laura: So, we're a full-service corporate securities and business transaction law firm. We represent public companies, and that is everything that a public company needs, including their SEC filings their mergers and acquisitions, their general corporate work, their follow-on things. We represent private companies in all forms of corporate finance transactions, including private offerings, mergers and acquisitions, and of course we do private and public transactions which is a full-on IPO, a direct listing, a reverse merger, we do a lot of regulation A+ and a lot in the exciting new space of securities.
Jeff: Right, which is certainly the topic we'd like to cover with you today. So, if you would just tell us a bit about what is happening in the security token world and in a digital security space in general.
Laura: Well, I think that securities tokens represent a fractional ownership interest in a company the same as a common stock does. But it's a different technology used to record and keep records and to trade and to settle and clear that fractional ownership interest and because of its decentralized nature, it can eliminate middle people and middlemen and the way that securities settle and trade in the United States, it is going to change – the proverbial train that has left the station. Recently T-Zero launched this week. They started their trading, which is the first actual marketplace trading digital securities and it's going to be very interesting to see what happens.
Jeff: So that opens up the pathway for others to start trading security tokens?
Laura: That's correct. So, it's a new technology. If you think about it, it was only back in the '70s that stock certificates were still in paper form and trading in the United States was in paper form, and things became digitized and DTC became such an important part of the trading of securities in the United States. Now you move forward to this new methodology of trading and T-Zero uses that new methodology which is on the blockchain and is moving very quickly. There are several companies out there in the branch of NASDAQ that just did another round of investment in a technology company that's working on building back end. It's coming, right? There's no stopping it. It is coming.
Jeff: Right. Agreed. So, let's go back a step to like the problems that we have that we certainly see in terms of clearing traditional securities, especially that are for smaller companies. My thinking is that as the clearing process changes, it's going to make it much easier and the compliance issues will be eliminated or diminished.
Laura: If you can program smart contracts within the law, for example, that's a way to trace ownership. That could help eliminate misbehavior and bad actors that set up accounts under other people's names, and we can help the SEC and other regulatory bodies do their job and eliminate fraud or reduce it.
Jeff: So, one of the things I find fascinating about at least some of the opportunities when it comes to digital securities are really customizing the nature of the securities, right? So, we know that you can do common stock like offerings, but I'm seeing some things that maybe are more preferred stock that have some features that may not be available to common stockholders. Are you seeing that as well?
Laura: Absolutely. Not only can you have any type of security that can represent a fractional ownership interest or write a right to royalties a right to revenues, a right any sort of right a fractional right to a subsidiary or to a certain business sector, but you can drill down into smaller fractions of that ownership using digitized securities.
Jeff: Right. Exactly. And by eliminating middle people by disintermediating, it cuts down costs so you can get a larger number of small investors throughout.
Jeff: Eventually, when again I know at this time it's accredited investors only in these offerings, but eventually they'll be secondary markets where I would say the average investor can participate.
Laura: Correct. And another beauty of it is that you can now take it away from just a company so you can actually have a fractional owner interest in an asset. You can have an ownership interest in a painting. A car, any type of asset, you can now have a fractional ownership interest in that asset by using digital technology. Regular technology allows you to do it too, but it's much more cumbersome then when you use digital technology.
Jeff: Exactly. So now that T-Zero is trading, do you think you'll see other companies now on that platform?
Laura: Oh, absolutely. T-Zero has 60 companies trading on their platform before the end of the year and opened up to non-accredited investors. Much like a securities exchange or alternative trading system in '80s, and there are many that are behind it that are working on getting their licenses and getting their systems. There are many that already have the licenses, but getting their systems in place to launch.
Jeff: So, this leads to a very important point from our perspective, and I think from yours as well. But we see a lot of those companies, and they walk into our door and they say, "Well, you know we're a private company, we're doing a private offering. It's 506-C," and I explain to them that the only way they're ever going to have liquidity, true liquidity on a secondary market is you're going to have to be a public company of some sort, right? There is going to be some kind of reporting requirements and governance in order to create secondary liquidity or sell to non-accredited investors, or even other accredited investors.
Laura: I do agree. I agree that the only way you ever have liquidity, especially if it's a private company, is if you have disclosure and you have a place, a secondary market that's acceptable to other people, and that's something that the T-Zeros and the platforms are going to offer. It'll really blur lines between private equity and private company trading, and public company trading. So, you could have it as long as the proper disclosures are there at private company trading in a marketplace in a secondary marketplace, and it doesn't have to be a full-on public company.
Jeff: Right. So that being the case, it seems to me it opens up another pathway for private companies to raise money from different sources than with traditional venture capitalists or … we see a lot of companies going public, probably too soon, and then we see all the problems that go with that so, at least it seems to me that with the ability to do a publicly marketed private offering. Private companies can access capital. Earlier stages and get listed on an exchange and again, whether they are going to be fully liquid, they at least have the opportunity to be traded amongst accredited investors.
Laura: I think it's really important that small companies have access to capital and having access to capital is one thing; having a pathway to liquidity for the investors in that company is second, and it's really important. I mean, no one is really going to just hold that security forever; there has to be an exit strategy, and I think that digital marketplaces offer more options on that exit strategy, especially if they eliminate certain clearing firms and allow for investors to deal directly with each other – of course, with proper controls in place to help prevent fraud, and protect investors.
Jeff: So, if people want to contact you, where would they go?
Laura: They can go to one of my three websites, which would be the main law firm site AnthonyPLLC.com, my blog site which is SecuritiesLawBlog.com, or my LawCast which is a video blog series located at LawCast.com.
Attorney Laura Anthony
Laura Anthony, Esq. is the founding partner of Anthony, L.G., PLLC, a national corporate, securities and business transactions law firm. For more than two decades Ms. Anthony has focused her law practice on small and mid-cap private and public companies, capital markets, NASDAQ, NYSE American, the OTC markets, going public transactions, mergers and acquisitions, registered public and exempt private offerings and corporate finance transactions, Regulation A/A+, initial cryptocurrency offerings (ICOs), Exchange Act and other regulatory reporting requirements, FINRA requirements, state and federal securities laws, general corporate law and complex business transactions. The Anthony, L.G. PLLC team has represented issuers, buyers, sellers, underwriters, placement agents, investors, and shareholders in mergers, acquisitions and corporate finance transactions valued in excess of $1 billion. ALG has represented in excess of 200 companies in reverse merger, initial public offering and direct public offering transactions. Laura Anthony, Esq., is also the creator and author of SecuritiesLawBlog.com and the host of LawCast™, Corporate Finance in Focus.
SOURCE Anthony, L.G., PLLC