After passing the Temperature Check vote with 7M UNI voting in favor of deploying Uniswap v3 on Gnosis Chain (GC), we are creating this post to move forward into the Consensus Check stage.
Comments on the previous post expressed support for v3 deployment on GC, but also suggested more clarity on the following topics:
We have updated this post accordingly and provided more details on each of these items.
In production since 2018 (as the xDai Chain), the rebranded Gnosis Chain is rapidly evolving with a new focus and mission. Gnosis Chain (GC) provides a real-world value chain that closely mirrors the Ethereum 2.0 ecosystem. This includes a beacon chain framework, rollups, and other vital functionality. GC will serve in a front-running capacity for important Ethereum 2.0 updates.
Tuned parameters on Gnosis Chain enable faster blocks and epochs, low-cost stable transactions, and the opportunity to construct trustless bridges and conduct seamless transfers between GC and the Ethereum 2.0 mainnet.
The Gnosis Chain team is committed to ecosystem development, adoption, and growth as the Eth2.0 landscape comes into focus. With a mission to “accelerate Ethereum,” Gnosis Chain is poised for expansion. With this in mind, we propose a Uniswap v3 deployment to Gnosis Chain. We believe there are many benefits for both Uniswap Labs and Uniswap users, some of which include:
A DeFi ecosystem primed for growth. Once deployed, Uniswap would become a cornerstone DeFi engine for protocols using and interacting within the ecosystem. Perpetual Protocol is a flagship protocol on GC that relies on Uniswap v3. This deployment will enable Perpetual to continue to flourish on the Gnosis Chain. Additional bluechip app deployments with growing TVL include Curve, Sushiswap, and Tornado Cash, with many new and promising DeFi projects choosing Gnosis Chain as their home base. A list of current projects is available at https://gnosischain.world/
An iterative environment. Uniswap Labs can experiment with new functionality and alpha test new features in a real-value environment (which differs from a test environment in that users behave differently with value on the line, token supply is limited, real adversaries exist, etc). Uniswap can spot and remediate any final potential issues stemming from important Ethereum updates prior to mainnet activation and take advantage of optimized slot and epoch times for faster iteration.
Tight Ethereum compatibility. Tools, resources, projects, and protocols supported by Ethereum are already supported on Gnosis Chain, with more onboarding regularly. Gnosis Safe is facilitating daily operations for many existing projects. A trustless bridge architecture designed to connect Ethereum and Gnosis Chain is in the works. The Gnosis Beacon Chain validator set is expanding rapidly bringing massive decentralization to the chain. The primary differences separating the GBC from the Ethereum Beacon chain include 5-second blocks and < 2-minute epochs, stable transactions with a max target of $.01 per 100K gas, and an economically and geographically diverse validator set, and a lower-stakes, lower-TVL environment.
Unique chain characteristics. Stable, low-cost transactions provide unique opportunities for Uniswap users. When gas costs are known and have a low impact on trade decisions, new strategies and approaches emerge which are currently untenable on the Ethereum mainnet or other chains with wide-ranging fee variability.
User incentives. A large directive for the Gnosis Chain is to increase the user base and on-chain activity by strategically allocating funds from the GnosisDAO treasury to promote adoption. An ecosystem fund has been created for this purpose, and we propose to use a portion of these funds to promote Uniswap v3 on Gnosis Chain. We propose providing up to $10M to incentivize the adoption of Uniswap v3 on Gnosis Chain.
The $10M will be provided in GNO to foster the usage of Uniswap v3 on Gnosis Chain. The incentives should be designed together with other projects, which are operating on top of Uniswap v3 such as Perpetual Protocol, Gelato, or Stakewise. This should allow for more sustainable utilization of Uniswap as Gnosis Chain doesn’t have a team dedicated to Uniswap v3. The GNO can be used to incentivize liquidity but should not be limited to this use case. Anything increasing usage of Uniswap v3, including building new applications on top of Uniswap v3 should be supported. The goal is to spend the $10M in the time period of 2 years. Funds not used after two years would go back to GnosisDAO. The spending is limited to $10M and the transferred amount of GNO as part of the proposal. GnosisDAO can decide to top up this amount based on the outcome of this initiative.
Since the Temperature Check, we have discussed with stakeholders within the Uniswap ecosystem, who have expressed a desire to see trust-minimized bridges used for governance for new Uniswap v3 deployments. In addition, we’ve also seen the Nomad team’s proposal to deploy v3 on Moonbeam, which includes a section addressing this, as well as documenting the current fragmented approach to governance across various v3 deployments.
In the interest of taking a standardized approach to cross-chain governance of v3 deployments moving forward, we’ve partnered with the Nomad team to leverage the Nomad generalized message passing channels to manage the governance of the Uniswap v3 deployment on Gnosis Chain.
We believe that Nomad is the best solution for cross-chain governance, as it:
Nomad will be deployed on Gnosis Chain shortly and will leverage Gnosis Zodiac Modules as part of its governance stack.
We are excited about partnering with Nomad to create a trust-minimized governance stack that can offer a standard for the Uniswap ecosystem.
We are requesting an exemption that will allow Gnosis Ltd. to use the Licensed Work to deploy it on Gnosis Chain, a layer 1 blockchain with deep connections to Ethereum, provided that the deployment is subject to Ethereum layer 1 Uniswap Protocol governance and control.
Following the Consensus Check phase, we will submit this proposal shortly after to an on-chain vote. Provided that the proposal passes both steps, and all governance systems have been built and audited, we will be ready to move forward with the Uniswap v3 deployment on Gnosis Chain.
As the proposal funding has to come from GnosisDAO, this proposal has to be accepted by both: UNI and GNO token holders. The execution of this proposal is dependent also on the acceptance of the proposal by GnosisDAO. The GnosisDAO proposal has to include the setup of the multi-sig and the allocation of GNO and would be executed once it is accepted by GNO token holders. Two singers from the Uniswap community and two singers from the GnosisDAO community should be selected to participate in the multisig wallet.
The Gnosis Chain is preparing for substantial growth in the coming year. We have implemented an aggressive infrastructure grants program including large grants to Nethermind, Lighthouse and Erigon client teams to support base-layer functionality and security. The ecosystem fund will bring in many new projects, and we feel Uniswap v3 is an essential component that will serve as a foundational layer for this growth.
We welcome any questions and comments and are happy to provide any clarifications as needed. We are excited to submit this proposal to the Uniswap community and look forward to your feedback! Thank you.
After passing the Temperature Check vote with 7M UNI voting in favor of deploying Uniswap v3 on Gnosis Chain (GC), we are creating this post to move forward into the Consensus Check stage.
Comments on the previous post expressed support for v3 deployment on GC, but also suggested more clarity on the following topics:
We have updated this post accordingly and provided more details on each of these items.
In production since 2018 (as the xDai Chain), the rebranded Gnosis Chain is rapidly evolving with a new focus and mission. Gnosis Chain (GC) provides a real-world value chain that closely mirrors the Ethereum 2.0 ecosystem. This includes a beacon chain framework, rollups, and other vital functionality. GC will serve in a front-running capacity for important Ethereum 2.0 updates.
Tuned parameters on Gnosis Chain enable faster blocks and epochs, low-cost stable transactions, and the opportunity to construct trustless bridges and conduct seamless transfers between GC and the Ethereum 2.0 mainnet.
The Gnosis Chain team is committed to ecosystem development, adoption, and growth as the Eth2.0 landscape comes into focus. With a mission to “accelerate Ethereum,” Gnosis Chain is poised for expansion. With this in mind, we propose a Uniswap v3 deployment to Gnosis Chain. We believe there are many benefits for both Uniswap Labs and Uniswap users, some of which include:
A DeFi ecosystem primed for growth. Once deployed, Uniswap would become a cornerstone DeFi engine for protocols using and interacting within the ecosystem. Perpetual Protocol is a flagship protocol on GC that relies on Uniswap v3. This deployment will enable Perpetual to continue to flourish on the Gnosis Chain. Additional bluechip app deployments with growing TVL include Curve, Sushiswap, and Tornado Cash, with many new and promising DeFi projects choosing Gnosis Chain as their home base. A list of current projects is available at https://gnosischain.world/
An iterative environment. Uniswap Labs can experiment with new functionality and alpha test new features in a real-value environment (which differs from a test environment in that users behave differently with value on the line, token supply is limited, real adversaries exist, etc). Uniswap can spot and remediate any final potential issues stemming from important Ethereum updates prior to mainnet activation and take advantage of optimized slot and epoch times for faster iteration.
Tight Ethereum compatibility. Tools, resources, projects, and protocols supported by Ethereum are already supported on Gnosis Chain, with more onboarding regularly. Gnosis Safe is facilitating daily operations for many existing projects. A trustless bridge architecture designed to connect Ethereum and Gnosis Chain is in the works. The Gnosis Beacon Chain validator set is expanding rapidly bringing massive decentralization to the chain. The primary differences separating the GBC from the Ethereum Beacon chain include 5-second blocks and < 2-minute epochs, stable transactions with a max target of $.01 per 100K gas, and an economically and geographically diverse validator set, and a lower-stakes, lower-TVL environment.
Unique chain characteristics. Stable, low-cost transactions provide unique opportunities for Uniswap users. When gas costs are known and have a low impact on trade decisions, new strategies and approaches emerge which are currently untenable on the Ethereum mainnet or other chains with wide-ranging fee variability.
User incentives. A large directive for the Gnosis Chain is to increase the user base and on-chain activity by strategically allocating funds from the GnosisDAO treasury to promote adoption. An ecosystem fund has been created for this purpose, and we propose to use a portion of these funds to promote Uniswap v3 on Gnosis Chain. We propose providing up to $10M to incentivize the adoption of Uniswap v3 on Gnosis Chain.
The $10M will be provided in GNO to foster the usage of Uniswap v3 on Gnosis Chain. The incentives should be designed together with other projects, which are operating on top of Uniswap v3 such as Perpetual Protocol, Gelato, or Stakewise. This should allow for more sustainable utilization of Uniswap as Gnosis Chain doesn’t have a team dedicated to Uniswap v3. The GNO can be used to incentivize liquidity but should not be limited to this use case. Anything increasing usage of Uniswap v3, including building new applications on top of Uniswap v3 should be supported. The goal is to spend the $10M in the time period of 2 years. Funds not used after two years would go back to GnosisDAO. The spending is limited to $10M and the transferred amount of GNO as part of the proposal. GnosisDAO can decide to top up this amount based on the outcome of this initiative.
Since the Temperature Check, we have discussed with stakeholders within the Uniswap ecosystem, who have expressed a desire to see trust-minimized bridges used for governance for new Uniswap v3 deployments. In addition, we’ve also seen the Nomad team’s proposal to deploy v3 on Moonbeam, which includes a section addressing this, as well as documenting the current fragmented approach to governance across various v3 deployments.
In the interest of taking a standardized approach to cross-chain governance of v3 deployments moving forward, we’ve partnered with the Nomad team to leverage the Nomad generalized message passing channels to manage the governance of the Uniswap v3 deployment on Gnosis Chain.
We believe that Nomad is the best solution for cross-chain governance, as it:
Nomad will be deployed on Gnosis Chain shortly and will leverage Gnosis Zodiac Modules as part of its governance stack.
We are excited about partnering with Nomad to create a trust-minimized governance stack that can offer a standard for the Uniswap ecosystem.
We are requesting an exemption that will allow Gnosis Ltd. to use the Licensed Work to deploy it on Gnosis Chain, a layer 1 blockchain with deep connections to Ethereum, provided that the deployment is subject to Ethereum layer 1 Uniswap Protocol governance and control.
Following the Consensus Check phase, we will submit this proposal shortly after to an on-chain vote. Provided that the proposal passes both steps, and all governance systems have been built and audited, we will be ready to move forward with the Uniswap v3 deployment on Gnosis Chain.
As the proposal funding has to come from GnosisDAO, this proposal has to be accepted by both: UNI and GNO token holders. The execution of this proposal is dependent also on the acceptance of the proposal by GnosisDAO. The GnosisDAO proposal has to include the setup of the multi-sig and the allocation of GNO and would be executed once it is accepted by GNO token holders. Two singers from the Uniswap community and two singers from the GnosisDAO community should be selected to participate in the multisig wallet.
The Gnosis Chain is preparing for substantial growth in the coming year. We have implemented an aggressive infrastructure grants program including large grants to Nethermind, Lighthouse and Erigon client teams to support base-layer functionality and security. The ecosystem fund will bring in many new projects, and we feel Uniswap v3 is an essential component that will serve as a foundational layer for this growth.
We welcome any questions and comments and are happy to provide any clarifications as needed. We are excited to submit this proposal to the Uniswap community and look forward to your feedback! Thank you.
Thank you for your comment. My proposal is to use the underlying technology to power TP4 Digital Assets "National Securities Token Exchange". Yes, all digital asset securities will "in fact" be securities or exempt from SEC registration. To adhere to SEC and FINRA rules there will be no unregistered securities/tokens traded or custodied at TP4. I am creating a new capital market structure "not a wrapper" to compete with the current legacy capital market structure. I believe, TP4 is in the best position to compete with Wall Street and a Uniswap V3 business/partnership will add value to my project.
I'm not sure this is the best case for granting a business license.
Uniswap's only benefit from this license being publicity/exposure does not seem like an adequate incentive.
It's unclear that TP4 would constitute a non-competitive enterprise giving its nascent stage of development.
Uniswap is a DEX that deals with digital assets that aren't securities, and is very conscious about the legal status that comes with supporting the exchange of securities, even if that might just be from the usage of V3's underlying technology. Being that this license and/or partnership would be directly in support of exchanging securities, it seems like it's not worth the relatively small incentive of increased exposure.
I'm not sure this is the best case for granting a business license.
Uniswap's only benefit from this license being publicity/exposure does not seem like an adequate incentive.
It's unclear that TP4 would constitute a non-competitive enterprise giving its nascent stage of development.
Uniswap is a DEX that deals with digital assets that aren't securities, and is very conscious about the legal status that comes with supporting the exchange of securities, even if that might just be from the usage of V3's underlying technology. Being that this license and/or partnership would be directly in support of exchanging securities, it seems like it's not worth the relatively small incentive of increased exposure.
(A meta note for those from the community who might be trying to weigh this request relative to the purview/capabilities of governance)
We at Other Internet think that there should be better guidelines for governance to determine the eligibility of a given to business licenses request such as this one. We've started the work of drafting what this policy could look like. As with all our governance initiatives we're working on, if this is something that's interesting to you, please reach out to us on twitter @otherinternet__
Uniswap V3 Business License Proposal
Project Overview:
Uniswap V3 Business License Proposal
Project Overview:
TP4 Digital Assets (“TP4” or the “Firm”) will be forming a new capital market structure for the trading, settlement, and custody of digital asset securities. This is a new capital market structure and not a pretty wrapper of the legacy settlement network or legacy securities exchanges. The Firm’s capital market structure will work by networking our custody/security token standard with the national securities token exchange, token clearing agency, and special purpose broker-dealer. SEC regulatory custody cannot happen without linking the entire network to our new security token standard.
TP4’s solution to regulatory custody of digital asset securities radically improves how capital markets trade for the first time since the Wall Street Paperwork Crisis.
The problem-Obstacles in the Current Capital Market Structure:
The discussion below addresses a few legacy capital market issues and the current regulatory custody issue for digital asset securities.
Legacy Settlement Network
The legacy settlement network generally works in two ways. First, an issuer must be eligible to be custodied within the legacy settlement network and pay a fee. Second, broker-dealers, banks and other market participants must be a member of the legacy settlement network and pay the required fee to participate in the legacy settlement network. In the US, equity, listed corporation and municipal bond trade through the legacy settlement network. Each trade, for the most part, takes T+2 days to settle, which drives unnecessary risk in the financial system. This longer settlement time requires a vast amount of capital, which is estimated to be around $13 billion daily. This capital is a requirement imposed on broker-dealers (such as Charles Schwab and Robinhood) for the risk of default or failure to deliver assets.
Legacy Securities Exchanges
The legacy exchanges charge various fees, such as transaction fees to market participants and listing fees to companies wanting to list their equity shares on the exchange. All trades occur through registered market participants, including brokerage firms, trading houses, and asset management companies. In addition to the transaction fee, these market participants also pay a one-time registration fee and a recurring annual membership fee to the legacy exchanges.
Just from two legacy securities exchanges, total combined annual fees paid by companies just to be listed are in the hundreds of millions of dollars.
Alternative Trading System (“ATS”)
Current trading of digital asset securities is limited to few broker-dealer ATS platforms. The limiting factors regarding ATS platforms are they operate independently causing a fragmented market, and they are required by SEC no-action letter dated September 2020 to operate as a noncustodial platform. There are no known SEC broker-dealer custody solutions that do not use a third-party bridge for custody.
Regulatory Framework for Security Token Custody
The SEC has provided regulatory guidance regarding the trading and custody digital asset/tokenized securities. In September 2020, the SEC issued a no-action-letter to FINRA regarding “ATS Role in the Settlement of Digital Asset Security Trades.” In December 2020, with an April 2021 effective date the SEC issued a “Statement Regarding the Custody of Digital Asset Securities by Special Purpose Broker-Dealers”.
These two steps are needed for the current tokenization market to operate; however, under TP4’s proposed capital market structure only the special purpose broker-dealer is needed.
The Solution: TP4 Digital Assets
I have spent 23 years in the financial industry, with the last 18 years at the U.S. Securities and Exchange Commission, Division of Examinations conducting hundreds of examinations of broker-dealers, transfer agents, and investment advisers. I joined the Division of Examinations Office of Risk and Strategy in early 2018 to study digital assets/crypto and its impact on broker-dealers, transfer agents, and investment advisers. To assess the impact of digital assets/crypto on SEC regulated firms, I conducted or participated in 30 examinations of broker-dealers, transfer agents, and investment advisers. During my time at the SEC, I became well-versed in not only broker-dealer custody requirements but also decentralized finance. While conducting market research in February/March 2021 on the NFT craze, I discovered a solution to the SEC Rule 15c3-3 broker-dealer custody issue.
TP4’s custody solution will require a new industry standard for security tokens. We will build a new capital market structure, around our custody/security token standard, to disrupt the legacy settlement network, legacy securities exchanges, and broker-dealer ATS platforms. To achieve this goal, TP4 will be implementing a new security token standard, forming a national securities token exchange (not an ATS), a token clearing agency (defi terms-an oracle), and a special purpose broker-dealer for custody. Our new capital market structure will have many benefits over the legacy systems:
• Creation of a Decentralized National Securities Token Exchange
• Peer-to-peer trading of security tokens
• T+0 finality settlement
• Elimination of T+2 and capital requirements
• Issuer access to global liquidity
• Greater access to investment options
• Investors ability to trade without settlement restrictions
• Direct list [for?] all tokenized securities to the exchange
• Reduction of issuer expenses
• Reduction of market participant expenses
About TP4 Digital Assets:
Currently TP4 is a pre-seed start-up with an SEC regulatory custody solution to Customer Protection Rule, SEC 15c3-3 that will allow for trading, settlement and custody of digital asset securities using blockchain. We will be forming a national securities token exchange (not an ATS), a token clearing agency (defi terms-an oracle), and a special purpose broker-dealer for custody.
TP4 Digital Assets Proposal:
TP4 is seeking a business license for the Uniswap V3 core contracts on which to build an AMM/DEX platform on our “National Securities Token Exchange”. Due to regulatory requirements and our custody/token standard we will need to modify the AMM/DEX to fit these needs. Our exchange will be registered with U.S. Securities and Exchange Commission for the trading of regulated digital asset securities.
TP4 exchange will note on the website and phone application that the exchange is powered by Uniswap V3. This will give Uniswap a much bigger audience, outside of decentralized finance, since TP4 will only trade regulated digital asset securities. To give perspective in 2020, $2.3 quadrillion worth of transactions in the U.S. equities markets were processed through the legacy settlement network. This business license agreement will benefit both TP4 and Uniswap. However, I believe a partnership to create a new capital market structure to disrupt the legacy capital market structure, benefits both.
The Ask-Conclusion:
TP4 Digital Assets will form a new capital market structure using blockchain technology to disrupt and improve how capital markets trade. There are no other projects attempting to create a new structure, because this is difficult, requires a vast amount of capital and talent. My goal is achievable and my solutions work.
I ask for yes votes to change how it all works! Thank you for your time and consideration.
TP4 Digital Assets
@tp4digitalasset (Twitter)
Thank you for your comment. My proposal is to use the underlying technology to power TP4 Digital Assets "National Securities Token Exchange". Yes, all digital asset securities will "in fact" be securities or exempt from SEC registration. To adhere to SEC and FINRA rules there will be no unregistered securities/tokens traded or custodied at TP4. I am creating a new capital market structure "not a wrapper" to compete with the current legacy capital market structure. I believe, TP4 is in the best position to compete with Wall Street and a Uniswap V3 business/partnership will add value to my project.
I'm not sure this is the best case for granting a business license.
Uniswap's only benefit from this license being publicity/exposure does not seem like an adequate incentive.
It's unclear that TP4 would constitute a non-competitive enterprise giving its nascent stage of development.
Uniswap is a DEX that deals with digital assets that aren't securities, and is very conscious about the legal status that comes with supporting the exchange of securities, even if that might just be from the usage of V3's underlying technology. Being that this license and/or partnership would be directly in support of exchanging securities, it seems like it's not worth the relatively small incentive of increased exposure.
I'm not sure this is the best case for granting a business license.
Uniswap's only benefit from this license being publicity/exposure does not seem like an adequate incentive.
It's unclear that TP4 would constitute a non-competitive enterprise giving its nascent stage of development.
Uniswap is a DEX that deals with digital assets that aren't securities, and is very conscious about the legal status that comes with supporting the exchange of securities, even if that might just be from the usage of V3's underlying technology. Being that this license and/or partnership would be directly in support of exchanging securities, it seems like it's not worth the relatively small incentive of increased exposure.
(A meta note for those from the community who might be trying to weigh this request relative to the purview/capabilities of governance)
We at Other Internet think that there should be better guidelines for governance to determine the eligibility of a given to business licenses request such as this one. We've started the work of drafting what this policy could look like. As with all our governance initiatives we're working on, if this is something that's interesting to you, please reach out to us on twitter @otherinternet__
Uniswap V3 Business License Proposal
Project Overview:
Uniswap V3 Business License Proposal
Project Overview:
TP4 Digital Assets (“TP4” or the “Firm”) will be forming a new capital market structure for the trading, settlement, and custody of digital asset securities. This is a new capital market structure and not a pretty wrapper of the legacy settlement network or legacy securities exchanges. The Firm’s capital market structure will work by networking our custody/security token standard with the national securities token exchange, token clearing agency, and special purpose broker-dealer. SEC regulatory custody cannot happen without linking the entire network to our new security token standard.
TP4’s solution to regulatory custody of digital asset securities radically improves how capital markets trade for the first time since the Wall Street Paperwork Crisis.
The problem-Obstacles in the Current Capital Market Structure:
The discussion below addresses a few legacy capital market issues and the current regulatory custody issue for digital asset securities.
Legacy Settlement Network
The legacy settlement network generally works in two ways. First, an issuer must be eligible to be custodied within the legacy settlement network and pay a fee. Second, broker-dealers, banks and other market participants must be a member of the legacy settlement network and pay the required fee to participate in the legacy settlement network. In the US, equity, listed corporation and municipal bond trade through the legacy settlement network. Each trade, for the most part, takes T+2 days to settle, which drives unnecessary risk in the financial system. This longer settlement time requires a vast amount of capital, which is estimated to be around $13 billion daily. This capital is a requirement imposed on broker-dealers (such as Charles Schwab and Robinhood) for the risk of default or failure to deliver assets.
Legacy Securities Exchanges
The legacy exchanges charge various fees, such as transaction fees to market participants and listing fees to companies wanting to list their equity shares on the exchange. All trades occur through registered market participants, including brokerage firms, trading houses, and asset management companies. In addition to the transaction fee, these market participants also pay a one-time registration fee and a recurring annual membership fee to the legacy exchanges.
Just from two legacy securities exchanges, total combined annual fees paid by companies just to be listed are in the hundreds of millions of dollars.
Alternative Trading System (“ATS”)
Current trading of digital asset securities is limited to few broker-dealer ATS platforms. The limiting factors regarding ATS platforms are they operate independently causing a fragmented market, and they are required by SEC no-action letter dated September 2020 to operate as a noncustodial platform. There are no known SEC broker-dealer custody solutions that do not use a third-party bridge for custody.
Regulatory Framework for Security Token Custody
The SEC has provided regulatory guidance regarding the trading and custody digital asset/tokenized securities. In September 2020, the SEC issued a no-action-letter to FINRA regarding “ATS Role in the Settlement of Digital Asset Security Trades.” In December 2020, with an April 2021 effective date the SEC issued a “Statement Regarding the Custody of Digital Asset Securities by Special Purpose Broker-Dealers”.
These two steps are needed for the current tokenization market to operate; however, under TP4’s proposed capital market structure only the special purpose broker-dealer is needed.
The Solution: TP4 Digital Assets
I have spent 23 years in the financial industry, with the last 18 years at the U.S. Securities and Exchange Commission, Division of Examinations conducting hundreds of examinations of broker-dealers, transfer agents, and investment advisers. I joined the Division of Examinations Office of Risk and Strategy in early 2018 to study digital assets/crypto and its impact on broker-dealers, transfer agents, and investment advisers. To assess the impact of digital assets/crypto on SEC regulated firms, I conducted or participated in 30 examinations of broker-dealers, transfer agents, and investment advisers. During my time at the SEC, I became well-versed in not only broker-dealer custody requirements but also decentralized finance. While conducting market research in February/March 2021 on the NFT craze, I discovered a solution to the SEC Rule 15c3-3 broker-dealer custody issue.
TP4’s custody solution will require a new industry standard for security tokens. We will build a new capital market structure, around our custody/security token standard, to disrupt the legacy settlement network, legacy securities exchanges, and broker-dealer ATS platforms. To achieve this goal, TP4 will be implementing a new security token standard, forming a national securities token exchange (not an ATS), a token clearing agency (defi terms-an oracle), and a special purpose broker-dealer for custody. Our new capital market structure will have many benefits over the legacy systems:
• Creation of a Decentralized National Securities Token Exchange
• Peer-to-peer trading of security tokens
• T+0 finality settlement
• Elimination of T+2 and capital requirements
• Issuer access to global liquidity
• Greater access to investment options
• Investors ability to trade without settlement restrictions
• Direct list [for?] all tokenized securities to the exchange
• Reduction of issuer expenses
• Reduction of market participant expenses
About TP4 Digital Assets:
Currently TP4 is a pre-seed start-up with an SEC regulatory custody solution to Customer Protection Rule, SEC 15c3-3 that will allow for trading, settlement and custody of digital asset securities using blockchain. We will be forming a national securities token exchange (not an ATS), a token clearing agency (defi terms-an oracle), and a special purpose broker-dealer for custody.
TP4 Digital Assets Proposal:
TP4 is seeking a business license for the Uniswap V3 core contracts on which to build an AMM/DEX platform on our “National Securities Token Exchange”. Due to regulatory requirements and our custody/token standard we will need to modify the AMM/DEX to fit these needs. Our exchange will be registered with U.S. Securities and Exchange Commission for the trading of regulated digital asset securities.
TP4 exchange will note on the website and phone application that the exchange is powered by Uniswap V3. This will give Uniswap a much bigger audience, outside of decentralized finance, since TP4 will only trade regulated digital asset securities. To give perspective in 2020, $2.3 quadrillion worth of transactions in the U.S. equities markets were processed through the legacy settlement network. This business license agreement will benefit both TP4 and Uniswap. However, I believe a partnership to create a new capital market structure to disrupt the legacy capital market structure, benefits both.
The Ask-Conclusion:
TP4 Digital Assets will form a new capital market structure using blockchain technology to disrupt and improve how capital markets trade. There are no other projects attempting to create a new structure, because this is difficult, requires a vast amount of capital and talent. My goal is achievable and my solutions work.
I ask for yes votes to change how it all works! Thank you for your time and consideration.
TP4 Digital Assets
@tp4digitalasset (Twitter)
I understand this a DeFi protocol, so let me share some Securities and Exchange Commission regulatory requirements to custody digital asset securities. In addition, I will share how I solved SEC custody and what that means for digital asset security market. At a high level the SEC requires digital asset broker-dealers to have a "good control location" and have "possession or control" over a digital asset security. You can find more information here https://www.sec.gov/rules/policy/2020/34-90788.pdf. How the current tokenized security market is structured the SEC has concerns regarding theft of private keys either through internal theft or hacking theft. And for this reason the SEC requires a third-party bridge for the custody of digital asset securities.
My firm, TP4 Digital Assets (“TP4” or the “Firm”) SEC broker-dealer custody solution will require a new security token standard for digital asset securities. Our custody/security token standard will free market participants from the walled garden of the current capital market structure and broker-dealer ATS platforms. To achieve this goal, TP4 will be forming a new capital market structure for the trading, settlement, and custody of digital asset securities. The Firm’s capital market structure will work by networking the custody/security token with our National Securities Token Exchange (not an ATS), Token Clearing Agency (defi terms-an oracle), and our Special Purpose Broker-Dealer. It is important to note that SEC custody cannot happen without networking the entire capital market structure with our custody/security token. Having a solution to SEC broker-dealer custody opens up opportunities to disrupt the legacy capital market structure. We can offer a fully decentralized national securities token exchange, peer to peer trading, direct access to the exchange, the elimination of T+2 settlement restrictions and daily capital requirement of broker dealers, due to the outdated T+2 settlement. Issuers can directly list their Regulation D, Regulation S, Regulation A and S-1 digital asset securities to the exchange.
I understand this a DeFi protocol, so let me share some Securities and Exchange Commission regulatory requirements to custody digital asset securities. In addition, I will share how I solved SEC custody and what that means for digital asset security market. At a high level the SEC requires digital asset broker-dealers to have a "good control location" and have "possession or control" over a digital asset security. You can find more information here https://www.sec.gov/rules/policy/2020/34-90788.pdf. How the current tokenized security market is structured the SEC has concerns regarding theft of private keys either through internal theft or hacking theft. And for this reason the SEC requires a third-party bridge for the custody of digital asset securities.
My firm, TP4 Digital Assets (“TP4” or the “Firm”) SEC broker-dealer custody solution will require a new security token standard for digital asset securities. Our custody/security token standard will free market participants from the walled garden of the current capital market structure and broker-dealer ATS platforms. To achieve this goal, TP4 will be forming a new capital market structure for the trading, settlement, and custody of digital asset securities. The Firm’s capital market structure will work by networking the custody/security token with our National Securities Token Exchange (not an ATS), Token Clearing Agency (defi terms-an oracle), and our Special Purpose Broker-Dealer. It is important to note that SEC custody cannot happen without networking the entire capital market structure with our custody/security token. Having a solution to SEC broker-dealer custody opens up opportunities to disrupt the legacy capital market structure. We can offer a fully decentralized national securities token exchange, peer to peer trading, direct access to the exchange, the elimination of T+2 settlement restrictions and daily capital requirement of broker dealers, due to the outdated T+2 settlement. Issuers can directly list their Regulation D, Regulation S, Regulation A and S-1 digital asset securities to the exchange.
Please note this Uniswap V3 business license will only be used for the trading, settlement and custody of regulated digital asset securities. This license is needed to achieve my goal of disrupting the legacy capital market structure.
Please let me know what additional steps are needed to obtain this business license.
I understand this a DeFi protocol, so let me share some Securities and Exchange Commission regulatory requirements to custody digital asset securities. In addition, I will share how I solved SEC custody and what that means for digital asset security market. At a high level the SEC requires digital asset broker-dealers to have a "good control location" and have "possession or control" over a digital asset security. You can find more information here https://www.sec.gov/rules/policy/2020/34-90788.pdf. How the current tokenized security market is structured the SEC has concerns regarding theft of private keys either through internal theft or hacking theft. And for this reason the SEC requires a third-party bridge for the custody of digital asset securities.
My firm, TP4 Digital Assets (“TP4” or the “Firm”) SEC broker-dealer custody solution will require a new security token standard for digital asset securities. Our custody/security token standard will free market participants from the walled garden of the current capital market structure and broker-dealer ATS platforms. To achieve this goal, TP4 will be forming a new capital market structure for the trading, settlement, and custody of digital asset securities. The Firm’s capital market structure will work by networking the custody/security token with our National Securities Token Exchange (not an ATS), Token Clearing Agency (defi terms-an oracle), and our Special Purpose Broker-Dealer. It is important to note that SEC custody cannot happen without networking the entire capital market structure with our custody/security token. Having a solution to SEC broker-dealer custody opens up opportunities to disrupt the legacy capital market structure. We can offer a fully decentralized national securities token exchange, peer to peer trading, direct access to the exchange, the elimination of T+2 settlement restrictions and daily capital requirement of broker dealers, due to the outdated T+2 settlement. Issuers can directly list their Regulation D, Regulation S, Regulation A and S-1 digital asset securities to the exchange.
I understand this a DeFi protocol, so let me share some Securities and Exchange Commission regulatory requirements to custody digital asset securities. In addition, I will share how I solved SEC custody and what that means for digital asset security market. At a high level the SEC requires digital asset broker-dealers to have a "good control location" and have "possession or control" over a digital asset security. You can find more information here https://www.sec.gov/rules/policy/2020/34-90788.pdf. How the current tokenized security market is structured the SEC has concerns regarding theft of private keys either through internal theft or hacking theft. And for this reason the SEC requires a third-party bridge for the custody of digital asset securities.
My firm, TP4 Digital Assets (“TP4” or the “Firm”) SEC broker-dealer custody solution will require a new security token standard for digital asset securities. Our custody/security token standard will free market participants from the walled garden of the current capital market structure and broker-dealer ATS platforms. To achieve this goal, TP4 will be forming a new capital market structure for the trading, settlement, and custody of digital asset securities. The Firm’s capital market structure will work by networking the custody/security token with our National Securities Token Exchange (not an ATS), Token Clearing Agency (defi terms-an oracle), and our Special Purpose Broker-Dealer. It is important to note that SEC custody cannot happen without networking the entire capital market structure with our custody/security token. Having a solution to SEC broker-dealer custody opens up opportunities to disrupt the legacy capital market structure. We can offer a fully decentralized national securities token exchange, peer to peer trading, direct access to the exchange, the elimination of T+2 settlement restrictions and daily capital requirement of broker dealers, due to the outdated T+2 settlement. Issuers can directly list their Regulation D, Regulation S, Regulation A and S-1 digital asset securities to the exchange.
Please note this Uniswap V3 business license will only be used for the trading, settlement and custody of regulated digital asset securities. This license is needed to achieve my goal of disrupting the legacy capital market structure.
Please let me know what additional steps are needed to obtain this business license.
