Archax Buys US Broker-Dealer: Can It Be a Dominant Tokenisation Player?

Archax, a UK-regulated crypto exchange and custodian that focuses on tokenised assets, has completed its second acquisition: it bought Globacap Private Markets, a US-based broker-dealer. The deal will enable the UK company to enter the US markets and expand its distribution and reach.

Archax Enters the US

The latest acquisition shows Archax’s intention to expand its services beyond the UK. Last October, it finalised a deal to purchase Spanish broker King and Shaxon Capital Markets, which will be rebranded as Archax Markets. Like the latest deal, the acquisition of the Spanish broker will allow Archax to establish a regulated presence in the European Union. However, that deal is yet to be completed.

Globacap is a US Securities and Exchange Commission (SEC) and FINRA-regulated broker-dealer and alternative trading system (ATS), offering primary and secondary securities transactions in US private markets.

The main purpose of the deal is to enable Archax to use Globacap's regulatory permissions to offer its core real-world asset (RWA) products and services in the US. According to the deal announced yesterday (Monday), Archax will rename Globacap to Archax Markets US.

Growing Demand for Tokenisation

The deal comes as demand for asset tokenisation continues to grow. This area is attracting interest from global banks, asset managers, and digital asset firms, who are increasingly using blockchain systems to move traditional financial instruments.

One of the most recent entrants is Fidelity Investments, which is seeking approval to launch a tokenised money market fund. The asset manager, with $15.1 trillion under administration, is also reportedly working on issuing stablecoins. Additionally, CME Group has partnered with Google Cloud to start tokenisation efforts, while the parent company of the New York Stock Exchange has teamed up with Circle to explore services built on the USDC stablecoin and tokenised fund USYC.

“The Archax vision has always been to offer our RWA products and services globally,” said Graham Rodford, CEO and co-founder of Archax. “The acquisition of Globacap PMI in the US builds on the strong partnership we already have with them in the UK and is part of that global strategy.”

Rodford further highlighted that his company's focus is on supporting institutional market participants in their shift from traditional to digital assets, particularly in the tokenisation of assets.

Archax also became one of the first digital securities exchanges to receive authorisation from the UK's Financial Conduct Authority (FCA) in August 2020. That approval included permission to operate as a Multilateral Trading Facility (MTF), and to provide brokerage and custody services. Furthermore, Archax was the first company to be registered as a crypto asset firm under the FCA's anti-money laundering rules.

“The US is a large and important global market,” Rodford added, “and with the recent change of government and new, clearer and more open regulatory landscape, it is important for firms in our space to have a clear US strategy – and this transaction gives us exactly that.”