Tether’s sister firm Bitfinex Securities mulls launching tokenized Blockstream Mining Note 2 in Q1.
Bitifinex Securities revealed plans for Blockstream Mining Note 2 (BMN2) debut in El Salvador before April. News of the tokenized product featured in Diario El Salvador publication with a timeline within Q1 this year.
The Tether sister entity plans to launch the tokenized note following the impressive success since the BMN1 debut in Luxembourg. The latter paid the investors over $70M worth of Bitcoin, translating to a 108% return.
Bitfinex plans to issue the BMN2 from El Salvador to democratize access to the investment vehicle. The operations chief, Jesse Knutson, clarified that the least investment for Luxembourg’s BMN1 was $100K for the non-qualified investors.
Digital Assets Hotspot?
The regulatory environment in El Salvador yields greater flexibility to digital assets. Notably, enacting the Digital Assets Law provides Bitifinex Securities a lower entry point. Knutson acknowledged this as opening the door for diverse investors to participate.
The Digital Assets Law became effective in January 2023 to eliminate regulatory ambiguity in the country. Additionally, the law targets growth in the industry by allowing tokenization of real-world assets (RWA) and stablecoin issuance.
Bitifinex Securities is a regulated platform involved in issuing and trading tokenized financial instruments, among them bonds, hash rate contracts, bonds, and real estate. Other products admissible per Salvadoran law are tokenized US T-bills.
Tokenization facilitates the fractional ownership of assets with high value. This eases the participation of retail investors in markets previously regarded as inaccessible. Today, investors leverage blockchain technology to trade assets 24/7 under guaranteed safety and transparency of transactions.
Leading financial entities led by Goldman Sachs and JPMorgan are actively pursuing the RWA tokenization space. Asset management firm BlackRock is actively participating in this space, though it unveiled its own tokenized asset fund (BUIDL) in March last year.
BlackRock head Larry Fink informed CNBC during the World Economic Forum (WEF) held in Davos, Switzerland, the urgency for the US Securities and Exchange Commission (SEC) to approve bonds and stock tokenization.
Fink labelled tokenization a critical constituent of financial reform as it promises to democratize investing while guaranteeing lower ownership costs. Accomplishing these advancements will ultimately reward investors as more opportunities become accessible.
Bitifinex is unveiling the tokenized note when analysts predict the RWA tokenized market will hit $50 billion in value this year. The analysts cite the primary drivers of increased adoption, institutional participation, and technological advancements.
Crypto-Friendly Hub Reputation
Bitifinex seeks to leverage El Salvador’s growing reputation as a global hub for the tokenized markets by unveiling the BMN2. The firm pursues the beaming opportunities in the tokenized market by 2030.
Bitifinex Securities’ proposal to unveil the tokenized note aligns with the recent declaration by Tether to relocate some operations to EL Salvador.
Tether, which is behind the issuance of the world’s largest stablecoin (USDT), revealed that the decision was informed by its full compliance with the regulatory requirements of the El Salvador authorities. In particular, Tether recently secured the Digital Asset Service Provider (DASP) licencing in El Salvador.
Tether clarified the relocation plans mainly involved setting headquarters in El Salvador. This will serve as the operations base for its projects and subsidiaries. Further, Tether is set to leverage the supporting crypto environment within El Salvador, which is the pioneer nation in adopting BTC as a legal tender.
With a market value of $137 billion for the USDT stablecoin, Tether shifting its operation base to El Salvador will positively impact the Central American country’s economy. This is likely to add to its GDP, considering that Tether recorded a record $13 billion profit from the issued tokens valued at $157.6 billion.
Also, Tether has plans to construct a tower within San Salvador. The skyscraper is set to portray a long-term commitment to establishing its foothold in the country.