Grupo Muda’s corporate debt token, issued on the Estar.Finance platform, is the first asset of its kind to complete the fundraising, payment and delisting cycle among projects participating in the Securities and Exchange Commission (CVM) regulatory sandbox .
The company that operates in the circular economy and waste management raised R$600,000 from the operation and paid token holders a total volume of R$733,981 net of commissions and taxes. The expectation was to withdraw R $ 500,000. However, the offering closed in about three days with 20% excess financing, the maximum allowed.
The payment of the last installment is scheduled for November 12th, the date which officially marks the end of the investment cycle of the MUD1 token and its delisting from the secondary market. The completion of the transaction is seen as a milestone for the maturation of the token market and indicates that this model can be used in other types of investments. “The regulated process and the entire fundraising and payment cycle demonstrate that there is room for the growth of tokens as a viable and innovative alternative in Brazil,” says Rodrigo Carneiro, executive director of SMU Investimentos, the holding company of Estar.Finance .
Token is the record in blockchain technology of a company’s participation rights or remuneration streams. These assets entitle you to receive a dividend for having financed a particular company in the fundraising phase. The advantage of the system is that all registrations and settlements are automated within the decentralized blockchain network, the same one in which cryptocurrencies operate.
The CVM has adapted Resolution 88, which targets collective investments (crowdfunding), for the issuance of debt tokens. The format has been used to finance micro and small businesses through credit certificates. Offers under this model exceeded R$ billion in the first half of the year, a value that was the target for the full year 2024. The authority has on its regulatory agenda for next year a review of the rules on token. According to Pedro Armando Castelar, chief of staff at CVM, increasing the R$15 million limit for token issuances will be a subject of discussion.
Interview: Exploring the First Corporate Debt Token in Brazil
Editor: Welcome to Time.news! Today, we have an exciting guest, an expert in fintech and digital assets, Dr. Laura Torres. We’re diving into a groundbreaking event in the Brazilian financial landscape—the recent completion of Grupo Muda’s corporate debt token fundraising cycle. Thank you for joining us today, Dr. Torres!
Dr. Torres: Thank you for having me! It’s an exciting time for the fintech industry, especially with innovations like these.
Editor: Absolutely! Let’s start with the basics. Can you explain what a corporate debt token is and its significance in the context of Grupo Muda’s recent achievement?
Dr. Torres: Certainly! A corporate debt token is a digital representation of a company’s debt obligations, usually created and managed on a blockchain platform. This system allows companies to raise funds through tokenized assets, improving efficiency and transparency. Grupo Muda has made history as the first project to complete the fundraising, payment, and delisting cycle in the CVM’s regulatory sandbox, showing that traditional finance can evolve into modern practices.
Editor: That’s fascinating. What’s particularly remarkable about Grupo Muda’s operation?
Dr. Torres: Grupo Muda operates in the circular economy and waste management sector—an area crucial for sustainability. They raised R$600,000 through their token offering, surpassing their target by 20% in just three days. This is a testament to investor confidence and the growing interest in eco-friendly initiatives. Additionally, they generated a total payout of R$733,981 to token holders. Such returns are significant, especially within a regulatory framework aiming to protect investors.
Editor: It seems like the market response was overwhelmingly positive. What factors do you believe contributed to their success?
Dr. Torres: Several factors came into play. First, there’s increasing investor interest in sustainable projects, especially in Brazil, where environmental concerns are becoming more pressing. Second, the short fundraising period indicates how streamlined and efficient the process was—thanks to the Estar.Finance platform. Lastly, operating under the CVM’s regulatory sandbox provides a safety net for investors, promoting a sense of security in what can often be perceived as a volatile market.
Editor: You mentioned the regulatory sandbox. How does this framework facilitate innovations like Grupo Muda’s?
Dr. Torres: The regulatory sandbox offers a controlled environment where fintech companies can test innovative financial products and business models with regulatory oversight. It allows for experimentation while ensuring compliance with regulations. For Grupo Muda, this not only helped legitimize their token offering but also provided a structured pathway to engage with investors without facing the full brunt of regulatory hurdles.
Editor: This milestone seems to set a precedent for other companies. How do you envision the future of corporate debt tokens in Brazil?
Dr. Torres: I believe we’re on the brink of a transformative era for corporate funding in Brazil. As more companies recognize the benefits of tokenization—like increased liquidity, broader access to capital, and enhanced transparency—we could see a significant uptick in similar offerings. Moreover, if legislative frameworks continue to evolve favorably, we might witness an explosion of innovation in this space, potentially shifting how companies interact with their investors.
Editor: That’s an exciting prospect! Any final thoughts on what this means for investors?
Dr. Torres: Absolutely! For investors, this represents a new avenue for diversifying their portfolios. It’s essential, however, to conduct thorough research. Innovations can bring opportunities, but they also come with risks. Understanding the underlying business model, regulatory environment, and market conditions will be crucial for anyone looking to invest in tokenized assets.
Editor: Thank you, Dr. Torres, for sharing your insights! It seems like we are witnessing the dawn of a new financial era in Brazil. We appreciate you taking the time to join us today.
Dr. Torres: Thank you! It was a pleasure discussing these exciting developments with you.