Pre-funding of the Robinhood Equity Token (RHET) is now live on the Swarm platform, the blockchain for private equity. Accredited investors can now reserve their stake in a fund created for the purpose of holding equity in Robinhood.
The first security token of its kind, once the minimum funding goal is reached a Swarm syndicate manager will form an entity using Swarm, acquire equity through established relationships with former employees and other equity holders, and convert committed funds into RHET equity tokens.
“Secondary equities transactions and refinancing of legal entities which hold private company equity are not new in the United States. What’s new here is the tokenisation of these assets, and the doors opened by this innovation,” says Philipp Pieper, CEO of Swarm Fund. “One of the key innovations of tokenisation is that token owners can participate in the value creation of the very network they are part of. Swarm is bringing this paradigm shift to companies that are key players within this movement, but have yet to permit the network to participate.”
Swarm provides blockchain-based infrastructure for the tokenisation of assets. Each tokenised asset is represented by a unique security token, created using the SRC20 standard. For individual company equity tokens coming to Swarm, an entity is created for the specific purpose of holding this equity. The ownership of this entity is tokenised for investors to access. Their token holdings represent fractional ownership of that entity, which in turn holds equity in a given company. The SWM token itself is used for gas, governance, and incentives on Swarm, much like how ETH serves as gas for applications running on Ethereum. The Robinhood Equity Token (RHET) is the first of many tokens representing equity in private companies expected to launch on the platform.
