GSR Capital Partners Overstock’s tZEROTo Develop Cobalt Backed Token
Equity firm GSR Capital joins a growing list of companies that have taken a keen interest on smart contracts, a key innovation of blockchain technology. The firm has consequently engaged the services of tZERO, a subsidiary of Overstock.com. The Hong Kong based firm is planning to leverage smart contracts capabilities in the sale of cobalt.
Cobalt Tokenization
The smart contract token sale of cobalt is poised to offer recurring tranches of electric vehicle battery-grade cobalt. In a press release, up to $200 million worth of cobalt material will go on sale starting 2019 until 2020. The token sale will be compliant with all the regulatory requirements as a way of attracting institutional investors.
With the help of blockchain technology, the two companies hope to build an ecosystem for a tokenized commodity purchase. The use of smart contracts should go a long way in simplifying the process of identifying, purchasing and tracking rare minerals. The two are also contemplating the possibility of adding a token trading platform in the region.
Smart contract automation should go a long way in reducing the overall costs of transactions. Its use should also go a long way in improving transparency in the process of purchasing rare earth metals in the sector.
“We are proud to partner with zero for this token offering and believe that their leadership in this space will benefit our shared global outreach. GSR and our partner will be doing more than just cobalt tokenization, and we see further growth in our partnership with zero including consummating an investment directly by next quarter,” says GSR Capital’s Chairman and Founder, Sonny Wu.
Smart Contract Growing Popularity
Cobalt tokenization as proposed by the two companies is a great idea and an exciting blockchain initiative. The initiative should strengthen the need for more blockchain innovations at a time of growing uncertainties about cryptocurrencies.
The use of smart contracts in the sale of rare earth metals is great news. For starters, it reaffirms blockchain innovations and capabilities when it comes to enhancing operations in various sectors. Smart contracts are becoming increasingly popular in part because of their ability to automate transactions thus relieving the need for third parties.
While the announcement of the GSR- tZERO smart contract partnership was a milestone achievement, some bad news did rattle investors. GSR Capital had initially confirmed plans to invest $400 million in Overstock and tZERO. The plans have since been put on hold for the moment.