What is theTTVTG? What are VT protectors and how does the token economy work? You can find answers to these and other questions in the glossary. Is your question not answered? Then do not hesitate to contact us.
ICO (Initial Coin Offering)
Initial Coin Offering (also called Token Generating Events, Token Launch or Token Offering) refers to the initial issuance of tokens (in analogy to the IPO, the regulated initial public offering). It represents a type of crowd-funding based on cryptocurrencies to finance projects or start-ups in an early phase (seed stage). Coins or tokens are usually sold in exchange for cryptocurrencies such as Bitcoin or Ether. Depending on the project and its design, the tokens can represent shares in a company or rights to use a product.
A format through which companies or individuals have the opportunity to help shape and propose an improvement in the legal and regulatory framework. For more information, see Innovation Clubs Contact SFI.
Tokens can represent rights (e.g., ownership or usage rights) to physical things. For example, if a painting is tokenized and the sale is made by transferring the token, the physical validator ensures that the buyer of the token can subsequently access the painting in accordance with the contract. The physical validator thus ensures the enforcement of the rights specified in the contract.
With the so-called token, the TVTG introduces a new legal object to enable the mapping of the “real” world on TT systems in a legally secure manner. A token is thus the digital representation of a piece of information on a TT system that can represent claims or membership rights vis-à-vis a person, rights to things or other rights and is assigned to one or more TT identifiers.
Persons who publicly offer tokens in ther own name or on behalf of third parties. One possible application are platforms that conduct Initial Coin Offerings (ICOs) for their customers.
Persons who originally create tokens by programming. The decisive factor is that they perform the activity professionally and generate the token as a service on a TT system.
Digitalization requires us to be able to digitally map and transfer not only information but also values. The token economy is a term for a digital economy in which blockchain technology, or rather the token, is used as the basis for the efficient transfer of rights and assets. Blockchain technology enables direct interaction between individuals with these tokens without the need for an intermediary or middleman. Sending digital assets over the Internet has therefore become as cheap and easy as sending an e-mail.
Tokens and TT Service Providers (Token and TT Service Provider Act; TVTG). The terminology “transaction systems based on trusted technologies” encompasses a as far as possible technology-neutral view of blockchain systems, in order to apply to future generations of technology as well. (See also TT System).
An identifier is the public key or address that enables the unique assignment of tokens.
TT-IDENTITY SERVICE PROVIDER
Persons who professionally identify the person authorized to dispose of a token and record it in a registry. This service is essential for the integration of machines (Internet of Things), for example. This enables users who carry out transactions with machines to check in advance to whom this machine is attributable. However, it can also be used to document ownership via tokens, e.g. in the event of inheritance or if the TT key is stolen or lost.
Service providers who hold tokens on a TT system (e.g. blockchain) in their own name for the account of others or carry out transactions for customers. In contrast to the custodian role, they act as owners vis-à-vis the contractual partners. They require mandatory authorization under the Trustee Act.
Service providers who verify the legal capacity and the requirements when disposing of a token. This includes, for example, services that ensure that only persons of legal age or those who have a specific authorization can acquire certain tokens.
Service providers who safeguard and hold the private keys in custody for their customers. The custodians can also carry out transactions on behalf of the customers.
“Transaction systems based on trusted technologies”. The term “trusted technology” (“TT”) means that the trust is created by the technology and not only by organizations, respectively intermediaries (e.g. large financial companies, banks, credit card companies, stock exchanges, governments, social media companies, etc.). Trustworthy” is understood to mean that the integrity of tokens, their unambiguous allocation and their secure exchange should be guaranteed.
Service providers who safeguard and hold the tokens in custody for their customers. The custodians can also carry out transactions on behalf of the customers.
VT-EXCHANGE SERVICE PROVIDER
Service providers that exchange money (legal tender) for tokens and vice versa as well as tokens for tokens. This includes, for example, physical exchange machines at which cryptocurrencies can be exchanged, but also platforms that offer the exchange exclusively online.