Trump Media and Technology Group, operator of US President Donald Trump's Truth Social platform, said on Wednesday that it plans to launch a blockchain token for shareholders that may give them perks and rewards.
The DJT token might be launched in collaboration with crypto exchange Crypto.com and might be distributed to existing shareholders at a ratio of 1:1 or one token per share held, in accordance with the corporate's announcement.
The token “could” include rewards and perks for DJT shareholders, including discounts on the Truth social media platform, the Truth+ media streaming platform and the prediction market Truth Predict.
However, the token shouldn’t be a tokenized stock and doesn’t entitle holders to shareholder rights or a claim on the corporate's future earnings, Trump Media confirmed to Cointelegraph.
Trump Media and Technology Group's stock performance during the last 12 months. The planned tokens is not going to track the corporate's price. Source: Yahoo Finance
The token demonstrates how blockchain technology will be combined with traditional asset classes to supply advantages to holders, but additionally illustrates that tokenized equity products don’t necessarily confer the identical rights as ownership of the underlying asset.
Robinhood tokenizes private equity, but users don't have the identical rights as shareholders
In June, asset brokerage platform Robinhood announced the launch of tokenized stock trading for patrons within the European Union.
Robinhood offered $5 price of SpaceX and OpenAI “private equity” tokens to its customers as a part of the launch.
An overview of publicly traded tokenized stocks. Source: RWA.XYZ
However, OpenAI almost immediately rejected the tokens, warning potential holders that they didn’t represent a personal equity stake in the corporate nor did they supply holders with any shareholder rights.
“We haven’t partnered with Robinhood, haven’t been involved in it, and don’t endorse it. Any transfer of OpenAI equity is subject to our approval. We haven’t agreed to any transfer,” OpenAI said in response to the Robinhood announcement.
Source: OpenAI
Lawyers and crypto industry executives told Cointelegraph that many tokenized equity products are intended to trace the worth of the underlying asset, but don’t actually represent equity in an organization or the contractual rights that include traditional stock ownership.
“There isn’t any direct claim to company assets, no voting rights and no access to internal financial information,” said John Murillo, chief business officer of fintech company B2BROKER.
