Equity Token Offering (ETO) is an advanced fundraising instrument, which allows any operating legal entity or company to issue shares of their equity in the form of tokens on DLT, exercising public or private placements. This is a hybrid investment model aimed at company growth either in exchange for equity, or partial ownership of that company. ETO represents a unique fusion of ICO, VC and IPO funding rounds.
The key difference between Security Token and Equity Token:
The Security Tokens represent tangible assets such as real estate, gold, etc., used as a collateral – underlying asset. The Equity Tokens represent the shares of the company converted into tokens issued within equity token ecosystem.