Conditional Transfer

As you may know, it’s already been possible for an investor holding a position in a T-REX security token to execute a “simple transfer” instruction to another white-listed investor: they simply need to select both the number of tokens to transfer and the counterpart’s wallet. The T-REX system then instantly performs a provision-check on their position, verifies that the counterpart is indeed whitelisted for the token considered and, upon submission and signature, the simple transfer instruction is sent to the blockchain for execution on a peer-to-peer basis.

However, some issuers and asset managers have confirmed to us that they need to assert more control over this type of transfer. Essentially, before the transfer is executed, they need to be able to authorize or reject the transfer between the two investors. This final “go” might be needed for various reasons, including checking pre-emption or veto rights for instance. We at Tokeny have listened to this request and are now introducing “conditional transfers” as part of our product offering.

An investor will initiate a conditional transfer exactly in the same way they initiate a simple transfer and the system will perform the same provision- and eligibility-checks. However, before the transfer is executed on the blockchain, an authorization request will be sent to the issuer (or his processing agent) for the transaction’s release or rejection. In case of rejection, a reason has to be provided and communicated to the investor. This is how it works:

It is up to the issuer of the T-REX security token to determine whether their token/s will allow for simple or conditional transfers. Investors will obviously only be able to instruct the type of transfers relevant for a specific token.