CEO - Keiko Tanaka
Today, Blockchain technology is no longer a just a buzzword but has grown to become a major disrupter rattling every industry from agriculture and manufacturing to healthcare and insurance. Blockchain applications enable scrutiny and optimization of processes in supply chains that traditionally fall outside the spectrum of enterprise solutions as industries explore the technology to reflect their own respective operational and strategic needs. That said, the financial services sector was tipped to experience the best of both worlds--most disruption and significant investment in blockchain solutions. With the creation of digital assets—a new token economy will make the financial industry more accessible, cheaper, and faster, thereby possibly unlocking trillions in currently illiquid assets and vastly increasing the volume of trade. Furthermore, the opportunities presented by security tokens will help the industry to re-shape an environment to provide greater efficacy and transparency for trading and post-trading processes.
In recent years, regulatory issues have emerged as a central concern for few industries as they find it more difficult to identify favorable circumstances to implement blockchain solutions in their business. However, security token offerings (STOs) combine the benefits of blockchain for financing but in a regulated environment, with the possibility of exchange based and asset-backed structures increasing potential appeal. This is where LEVIAS is revolutionizing the Japanese fintech industry by fusing cutting-edge technologies such as blockchain, AI, and IoT to create an unprecedented new economic and social value chain. The company provides reliable data governance infrastructure systems to clients (third parties) and create innovation through digital transformation (DX) from the development of potential markets. LEVIAS is the first company to conduct STO legally in Japan and secondary transactions (transfer of assets) utilizing blockchain technology with its J-STO platform. "Our mission is to cooperate with leading partners beyond industry barriers, to facilitate innovation with the development of new technologies and services," says CEO of LEVIAS, Keiko Tanaka.
Our mission is to cooperate with leading partners beyond industry barriers, to facilitate innovation with the development of new technologies and services
LEVIAS' J-STO platform is Japan's first information and communication management system that uses security tokens to connect the issuers and investors of securities and designs new economic value by liquidating assets. The company's platform enables users to manage information on various contracts and assets, which were previously managed in written form and other analog ways, to be managed in a highly reliable digital format by utilizing blockchain and AI technology. Users will be able to perform a series of agreements and acceptance procedures accompanying each contract by a program (smart contract) defined under the framework of the current Japanese law. Thus, reducing the number of human errors by speeding up procedures related to asset transfers.
Asset Holders will receive security tokens in the form of electronic vouchers recorded on a private blockchain in proportion to the equity interest as proof of contractual status. The Security Tokens incorporate evidence information such as investment contracts into an information processing program (smart contracts) relating to the transfer of contractual status. A security token holder will be able to view the information about the owned assets at any time on the user-dedicated interface on the J-STO platform. Users can also apply for bilateral transactions related to the transfer of contractual status, perform a series of agreements/acceptance procedures accompanying various contracts, and automatically modify the name list of multiple assets. The information on the transfer of these assets will be recorded by blockchain traceability and stored as trail information for AML. In addition, by applying AI technology, various autonomous programs are monitored continuously for regular and proper operation. Suspicious transactions are detected and met with a countermeasure program to promote work-flow efficiency. The final element of the platform is the creation of a new concept of liquidity. Sustainable development of security tokens in DLT will rely on a robust ecosystem coupled with a well-defined regulatory framework and compliance. LEVIAS brings a new approach and innovative mindset for new entrants and expertise of the existing market infrastructure operators. To reduce the complexity of procedures and cost performance in transferring assets, J-STO's platform aims to create a new environment to connect users through the Internet and apply for transactions according to compliance procedures. This new approach will probably disrupt current stakeholder roles and also prompt the development of new ones.
Despite the fact that STOs will provide a significant business opportunity and financial innovation to financial markets, investors and issuers, the structure remains at an early stage. Regulators are yet to provide comprehensive rules and requirements to cover the STO related activities, such as enabling an appropriate linkage between virtual assets and any underlying assets. Furthermore, given that Security Token trading activity can be borderless, global regulators need to cooperate in a consistent approach and method in regulating and supervising STOs.
Established in 2018, LEVIAS aims for an IPO by 2024, contributing significant growth to the Japanese economy by taking advantage of the strengths of venture companies, such as good “footwork” and a sense of speed, to solve various problems including the issues mentioned above. "LEVIAS will focus on building new data governance one by one regarding the connection between Japan and other countries by building a de-facto standard environment and acting as an international hub," concludes Tanaka.