Securitize will leverage the securitize blockchain protocol to offer their services to digital securities issuers. The Securitize Compliance Platform and Protocol provides a proven, complete solution to issuing and managing digital securities (security tokens). Securitize has pioneered a regulatory-compliant, full-digital, full-service platform to issue, manage, and exchange digital asset securities, with almost 200 companies and 325,000 investors already connected.
In comparison, Securitize has spent more than three years working with regulators to provide digital asset securities in a regulatory compliant manner. Funding activities are in the Algorand Blockchain, and Securitize acts as a transfer agent for the digital asset securities. The raising comes as blockchain company Securitize is developing a market called Securitize Markets to trade digital asset securities. Blockchain firm Securitize is also running an asset management arm called Securitize Capital, offering two crypto-yield funds.
The Growth of Securitize
Founded in 2017, Blockchain company Securitize allows private companies to raise money by issuing digital securities via their blockchain-based platform. It currently offers solutions to privately held companies for raising capital and issuing both traditional stock records and tokenized stock, among other services. For example, companies that run Reg A offerings could raise up to $75 million from retail investors in the new blockchain-based exchange platforms. Accredited investors–individuals and institutions who meet specific qualifications, under US law, for investing in private markets and alternative assets–are expected to be the core constituency in securitized markets.
The Silicon Valley start-up unveiled its new blockchain-based trading platform on Tuesday — taking a step closer to realizing its vision of enabling broader access to what could be profitable, but sometimes risky, alternative assets. They launched Securitize Markets, its securities-token trading venue in a second-party marketplace, today, nearly a year after it acquired DTM, an alternative trading system (ATS) registered with the Financial Industry Regulatory Authority and an SEC-registered broker-dealer. The fully-digital entity comprises of Securitize, Inc. and subsidiaries Securitize, LLC (an SEC-registered depository) and Securitize Markets, LLC (an SEC-registered broker-dealer, a member of FINRA and SIPC, and the operator of the Companys alternate trading system, Securitize Markets). Securitize began with providing a compliance platform that allowed securities, or other assets, such as real estate or funds, to easily convert to tokenized securities.
The Silicon Valley start-up, founded in 2017, now offers private companies the opportunity to raise money via securities tokens built on blockchain technology, the system of records that underpins bitcoin and other digital assets, and helps issuers better track who holds their tokens. Cryptocurrency securities platform Securitize is looking to bring blockchain technology to Wall Street. Santander InnoVentures, a fund that invests in venture-capital-backed technology startups at the Santander Groups, announced an investment in the company, a California-based start-up offering a globally trusted solution to issuing and managing compliance-compliant digital securities on the blockchain.
Founded in 2017, Securitize creates securities as unique digital tokens and records them in a decentralized blockchain network, which allows firms to know ownership of each security and to access all trade activities in real-time. The eleven assets now issued via their blockchain protocol utilize the Ethereum blockchain.6 The Securitize protocol allows for the digital securities to be traded in alternative trading systems (ATSs) that are regulated by the U.S. Securities and Exchange Commission, such as tZERO, the OpenFinance Network, and Sharespost. The Securitize Protocol, which manages the compliant secondary trading and company actions of digital securities, has the highest adoption currently in the industry, with 11 digital securities now issued, five traded on publicly traded markets, and dozens more in the pipeline.
Assets listed herein, such as digital assets or tokens using the Blockchain, are speculative, involve high levels of risk, are typically illiquid, may not have value, have limited regulatory certainty, are subject to the potential risk of market manipulation, and can subject investors to principal loss. Any financial projections or returns shown herein are provided by the issuers of the underlying securities, and Securitize Markets has not verified accuracy. Offers to sell, or the solicitation of offers to buy, any securities may be made only by means of formal offerings documents which provide essential information regarding risks, fees, and expenses associated with applicable securities that are available for trading on the Securitize Markets ATS.
The underlying factors are credit quality of the securitized assets and asset classes, which we do not anticipate will change due to the implementation of the blockchain. When it comes to the integration of blockchain in the securitization process, how DLT would efficiently insulate securitized assets poses questions to us in our analysis. We think that the most impacted pillars in our framework would be legal and regulatory risks, as well as operational and administrative risks, at first, from applying blockchain technology to the securitization process.
If assets change to tokens through the use of a blockchain, and/or smart contracts drive transactions related to an asset, or a securitization transaction more broadly, at this point, it is unclear which legal conveniences will be relevant for our legal analysis, or which forms of legal conveniences we might require in our legal analyses, especially for transactions that involve a public blockchain, where no controlling party is in charge.