Swarm recently announced the first security token of its kind with the tokenization of private equity in Robinhood. The Robinhood Equity Token (RHET) is now live on the Swarm platform, and represents fractional ownership in the giant $5.8 billion stock trading company. The creation of RHET follows on from Swarm’s mission to source high quality investment opportunities for their community and make them accessible by tokenizing these assets in conformity with legal regulations. RHET, the first of Swarm’s individual tech equity tokens, joins the assortment of SRC-20 offerings currently available on the Swarm platform, signaling a new trend in the tokenization of security assets in the form of private equity.
Previously, retail investors could not access these kinds of high-return investments, and private equity investors had no easy way of liquidating their holdings. This issue is also being addressed by SEC Chairman Jay Clayton as a serious problem. Speaking recently to groups of entrepreneurs and business-school students in Nashville, as reported by the Wall Street Journal, Mr Clayton said “The Securities and Exchange Commission wants to make it easier for individuals to invest in private companies, including some of the world’s hottest startups”. The SEC Chairman further stated that “The private markets are awash in capital these days. The question is, who is participating?
Swarm has already taken action with the creation of new private equity tokens, opening the gates to both the buying and selling parties to remove the middleman and create a entirely new, democratized financial market. Private equity investors who received shares during their employment at a private company, or VC investors holding equity, can now liquidate their holdings when they choose to do so much more easily than ever before, exiting an investment when it suits them. Now, private equity holders are no longer bound to minimum terms which lock their assets and which may prevent access to other opportunities that may come along. Swarm connects them to a new world of potential investors who are eager to access these high-quality investments.
By removing the middleman, Swarm has removed the high fees that have excluded retail investors from certain high-value opportunities, now enabling them to invest in tokenized security assets which represent fractional ownership in any type of private equity.
RHET is now available on the Swarm platform and open to all Swarm community members for purchase. Once the minimum funding goal is reached, this private equity in Robinhood is owned and governed collectively by Swarm contributors.
The launch of RHET on the Swarm network sparks the beginning of a new paradigm in the tokenization of underlying equity assets, and the creation of new and democratized security token markets for all investors. To find out more, check out Swarm.