L2 Capital and Newton Labs plan to tokenize $500M in pre-IPO AI shares

Everyone wants a piece of the AI boom before it hits the public markets. Most people, however, don’t get invited to that party. Hong Kong-based L2 Capital has partnered with Newton Labs on a plan to tokenize $500 million in pre-IPO AI shares. That makes L2 Capital the first partner on a platform Newton Labs is still building. The pitch rests on one idea. The compliance rules would live inside each token, and those rules would be checked before any transfer is allowed to settle. How the compliance-in-the-token model works The deal runs on the Newton Protocol, which Newton Labs describes as an on-chain authorization layer. Its job is to enforce compliance, identity, security and risk policies on a transaction before settlement happens. Most blockchain transfers today are simple. If you hold the token and sign the transaction, it moves, and any regulatory questions get sorted out later, if at all. Newton flips that order. Rules are embedded directly into the asset or application, so checks happen at the token level ahead of time. Those checks can cover several areas: Investor eligibility, such as whether a buyer qualifies to hold a restricted security Sanctions screening Jurisdiction ...