What is a security token offering (STO)? The advent of Bitcoin in 2009 made Blockchain mainstream. While cryptos and other blockchain-related financing garnered the trustworthiness of being volatile and speculative, there's a wide consensus regarding the worth of blockchain technology and other kinds of distributed ledger technology in finance. Large institutions across banking and technology, such as for example JP Morgan, Square, and Facebook, have already entered the blockchain space. Moving forward, we'll see more names as blockchain begins to play an ever-growing role in payments systems, including CBDCs and stablecoins, and the context of liquidity, via asset tokenization through security token offerings. The term 'tokens' immediately evokes thoughts concerning ICOs, a technique for raising capital for crypto projects and popularized in 2017, which can be where we'll begin our journey. What is an initial coin offering (ICO)? ICO, short for initial coin offering, is comparable in concept to initial public offering (IPO), as both allow startup companies and entrepreneurs to raise funds. While securities get issued in return for investment in a IPO, coins or tokens are given to investors in ICOs. The method where a business ICOs is simple, but the possible lack of regulation within the US and abroad around ICOs has resulted in fraudulent crowd sales, illegal airdrops, and outright scams. The ICO craze in 2017 tarnished the reputation of blockchain and tokens for a brief period. But through these turbulent times, blockchain's utility as a transformative technology remained strong. The distributed ledger and blockchain industry kept low, on the lookout for an improved mixture of technological benefits to create new methods and value to legacy security offerings. The confluence of those two brought together innovative tokens in the shape of a "security token."