The 2008 downfall of Bernie Madoff after his $65 billion Ponzi scheme shook Wall Street to its core. In fact, nearly 15 years after the first headline appeared about the crimes committed, investors in Madoff’s fund are still looking to recover losses. From pension funds to grandparents, those nest eggs may be lost forever.
While the creditors and the court-appointed trustee in the Madoff case still work to recover more of the losses, the process has been slow, complex and inefficient – with many investors only receiving a fraction of what was stolen from them.
Renata Szkoda is the chief financial officer of INX, which offers a trading platform for security tokens.
What if those same people had had access to security tokens enabling the recovery of their losses and even profit from recovery of the business with a promise of future cash flows? Whether it’s Madoff or crypto lender Celsius Network, security tokens may be the go-to solution to democratize and simplify bankruptcy recovery efforts for creditors and investors alike.
The new ‘fail-safe’ tool in finance
To fully understand the usefulness of security tokens, you must first understand what they are and what they are not. Security tokens are regulated tokenized assets issued on the public blockchain that represent an investment in an enterprise providing a profit share or equity stake to the holder. They are publicly traded on a regulated market and interact with smart contracts, which lowers costs and increases…
