Quote from: Awesomus Maximus on January 08, 2019, 10:06:32 AM

Security token is nothing more than a normal token with additional regulations. If regulations are added to a normal token it is proclaimed to be a security token. As such, the security token is regulated by the government bodies and should be compliant with the various SEC regulations. It can also be penalized by the government bodies for not complying. So a STO is more or less the same as the ICO with added regulation to it. Because of the increased security and because of the improved credibility, this is good for the investors but it doesn't imply that the STO will always be successful. The buyer has to be responsible for his decisions and capable to access the quality of the STO he is about to invest in or otherwise he may lose his investment.

I don't know why so far I understood the security tokens this way, which is a bit different from your explanation.

A security token is one that is not essential to the usage of a product or service. They are actual financial securities, meaning your tokens are backed by tangibles like the revenue, assets, and profits of a company. Just like stocks you can trade them or keep them as you wish.
Security token offerings are financial securities because they mimic traditional shares. These types of tokens give investors some rights to the company. When you buy a share in a company, they usually carry a specific set of rights and obligations. Voting rights would be a good example here as well as shareholder dividend payouts.

And what does make an STO a real STO? The fact that it is compliant with applicable legislation on securities.

Even though an ITO or ICO is regulated that doesn't make their coin/utility token a security, they don't constitute financial securities. They don't pay you dividends.

This how I understand and how I am witnessing by following HYGH what is a security token offering. There is no product "based on blockchain" and all those ICOs bullshit. The blockchain is being used for issuing the security token that pays you dividends. Then it is up to you whether deciding to hodl and receive passive income or trade them when the price starts mooning.

Am I understanding STO wrong or?

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