0x Joins Forces with Harbor to Back Security Tokens, Welcomes Former PayPal COO in Advisory Board

In a move seen as a further boost to security token offerings (STO), 0x, an open protocol that allows trading of Ethereum-based tokens announced on Sunday a partnership with Harbor, a compliance protocol for tokens that is backed by former chief operating officer of PayPal, David Sacks. According to the agreement, Sachs joined 0x’s advisory board, which will support the startup in the development of a market standard for security tokens.

“0x and its growing network creates the opportunity to connect buyers and sellers around the world. By tackling the regulatory compliance challenges of tokenizing private securities, Harbor makes it easy for issuers and investors to abide by existing rules and regulations across jurisdictions,” said Harbor CEO Josh Stein, as reported by Fortune.

Security tokens are a relatively new concept, though they have been already implemented by several companies, especially in North America. What makes security tokens different from the traditional ones (many of which are utility tokens) is that security tokens are backed by real-world assets like company stocks, real estate ownership or commodities, among others. Thus, in the case of stock-backed tokens, they might provide holders with voting rights and dividends.

Sacks, who co-founded Harbor and is currently a partner at Craft Venture, said that the property market would be the first one to move to a blockchain-powered form of ownership. He previously noted that security tokens ensure more liquidity, which has an impact for both institutional and retail investors.

0x CEO Will Warren expects the partnership with Harbor to establish more liquid and efficient markets for alternative assets.

“In the next five years, there will be a massive shift away from securities being in closed systems that are highly regulated and hard to access. It will be a much more open system where trading location is less important. But for this to happen, there needs to be a security token tech stack,” he noted.

0x’s token, ZRX, saw a boost in its price starting at mid-July when crypto exchange Coinbase announced it would work to add five more coins, with ZRX among them.