Securitize Gets FINRA Nod for Broker-Dealer/ATS Acquisition
- Securitize will be capable of offering blockchain-based securities and at some point its own secondary marketplace.
Security Token Security Token Security tokens are cryptocurrency tokens that represent a contract into an underlying security, which could include stocks, funds, bonds, and real estate investment trusts (REITs.) Security tokens can also be used as a method of fundraising. A security token offering (STO) is similar in nature to an initial public offering (IPO), however involves tokenized digital securities, known as security tokens. These are then sold in cryptocurrency exchanges. Tokens can be used to trade real financial assets such as equities and fixed income, and use a blockchain virtual ledger system to store and validate token transactions.In a regulatory sense, tokens are classified as securities and are more susceptible to oversight. This makes them more secure relative to other alternatives such as initial coin offerings (ICOs), which have resulted in countless cases of fraud.Many STO can also be held on regulated stock exchanges that can be characterized as tokenized IPO. These offerings have benefits, including the potential to deliver significant efficiencies and cost savings.Where Are STOs Legal?STOs are regulated and legalized in several countries where ICOs have not. This makes them the preferred method of fundraising and are fully regulated in following jurisdictions: European Union, Germany, United Kingdom, Switzerland, United States, Canada, Brazil, Australia, Israel, Singapore, Japan, and Hong Kong.In particular, STOs are placed under securities legislation. Even in the aforementioned jurisdictions however, security tokens still require a connection to a registered company with real assets being sold.There is some degree of controversy surrounding security tokens, mainly as a means of their classification. There exists a debate surrounding security tokens as to their legal differentiation of whether they can be characterized as a utility instead of a security. Traditionally, a passive financial return is expected from the investment, thus it is classified as a security. Security tokens are cryptocurrency tokens that represent a contract into an underlying security, which could include stocks, funds, bonds, and real estate investment trusts (REITs.) Security tokens can also be used as a method of fundraising. A security token offering (STO) is similar in nature to an initial public offering (IPO), however involves tokenized digital securities, known as security tokens. These are then sold in cryptocurrency exchanges. Tokens can be used to trade real financial assets such as equities and fixed income, and use a blockchain virtual ledger system to store and validate token transactions.In a regulatory sense, tokens are classified as securities and are more susceptible to oversight. This makes them more secure relative to other alternatives such as initial coin offerings (ICOs), which have resulted in countless cases of fraud.Many STO can also be held on regulated stock exchanges that can be characterized as tokenized IPO. These offerings have benefits, including the potential to deliver significant efficiencies and cost savings.Where Are STOs Legal?STOs are regulated and legalized in several countries where ICOs have not. This makes them the preferred method of fundraising and are fully regulated in following jurisdictions: European Union, Germany, United Kingdom, Switzerland, United States, Canada, Brazil, Australia, Israel, Singapore, Japan, and Hong Kong.In particular, STOs are placed under securities legislation. Even in the aforementioned jurisdictions however, security tokens still require a connection to a registered company with real assets being sold.There is some degree of controversy surrounding security tokens, mainly as a means of their classification. There exists a debate surrounding security tokens as to their legal differentiation of whether they can be characterized as a utility instead of a security. Traditionally, a passive financial return is expected from the investment, thus it is classified as a security. Read this Term firm Securitize said on Tuesday it got the green light from the US regulators to move forward with a duo of acquisitions, a broker-dealer and alternative trading system for digital assets.
The San Francisco-based startup, which helps firms tokenize their securities and assets, got such an endorsement to buy Distributed Technology Markets (DTM) in a bid to enter more regulated markets and reach institutional investors.
Distributed Technology Markets is part of a family of companies, and the acquisition will include taking over its sister company, Velocity Platform, which runs a money services business with money transmitter licenses in several states.
As part of the takeover, the newly acquired entity will be renamed Securitize Markets, which will offer a complete digital suite of services from primary issuance through secondary trading. Jonathan Kelfer, Co-founder and former CEO of Velocity Markets, has been named as the firm’s new CTO.
Regulators Clear Security Token Trading Systems
“By integrating Securitize Markets into our existing digital transfer agent platform and services, we can now offer a seamless digital solution for issuers and investors that dramatically improves the experience compared to the poorly digitized processes that are being used today,” said Securitize CEO and co-founder, Carlos Domingo.
Chris Wittenborn, CEO of Securitize Markets, also noted: "Securitize Markets is continuing the initiative of working hand in hand with regulatory bodies to construct a compliant capital markets framework for private securities - including digital asset securities. We're excited to join forces with Securitize in an effort to continue developing this market."
Securitize will capitalize on DTM’s regulatory approval to operate as an alternative trading system (ATS), which facilitates transactions in securities that are not publicly-traded. It creates a way for companies to tokenize equity and issue it on a blockchain without running afoul of regulatory obligations.
Many Fintech and blockchain firms have responded to US regulators’ classification of certain digital tokens as securities and therefore coming under the SEC’s supervision. Wall Street’s top watchdog says that any entity that wants to become an ATS needs to register with the SEC as a broker-dealer and become a member of a self-regulating organization, such as FINRA.
Security Token Security Token Security tokens are cryptocurrency tokens that represent a contract into an underlying security, which could include stocks, funds, bonds, and real estate investment trusts (REITs.) Security tokens can also be used as a method of fundraising. A security token offering (STO) is similar in nature to an initial public offering (IPO), however involves tokenized digital securities, known as security tokens. These are then sold in cryptocurrency exchanges. Tokens can be used to trade real financial assets such as equities and fixed income, and use a blockchain virtual ledger system to store and validate token transactions.In a regulatory sense, tokens are classified as securities and are more susceptible to oversight. This makes them more secure relative to other alternatives such as initial coin offerings (ICOs), which have resulted in countless cases of fraud.Many STO can also be held on regulated stock exchanges that can be characterized as tokenized IPO. These offerings have benefits, including the potential to deliver significant efficiencies and cost savings.Where Are STOs Legal?STOs are regulated and legalized in several countries where ICOs have not. This makes them the preferred method of fundraising and are fully regulated in following jurisdictions: European Union, Germany, United Kingdom, Switzerland, United States, Canada, Brazil, Australia, Israel, Singapore, Japan, and Hong Kong.In particular, STOs are placed under securities legislation. Even in the aforementioned jurisdictions however, security tokens still require a connection to a registered company with real assets being sold.There is some degree of controversy surrounding security tokens, mainly as a means of their classification. There exists a debate surrounding security tokens as to their legal differentiation of whether they can be characterized as a utility instead of a security. Traditionally, a passive financial return is expected from the investment, thus it is classified as a security. Security tokens are cryptocurrency tokens that represent a contract into an underlying security, which could include stocks, funds, bonds, and real estate investment trusts (REITs.) Security tokens can also be used as a method of fundraising. A security token offering (STO) is similar in nature to an initial public offering (IPO), however involves tokenized digital securities, known as security tokens. These are then sold in cryptocurrency exchanges. Tokens can be used to trade real financial assets such as equities and fixed income, and use a blockchain virtual ledger system to store and validate token transactions.In a regulatory sense, tokens are classified as securities and are more susceptible to oversight. This makes them more secure relative to other alternatives such as initial coin offerings (ICOs), which have resulted in countless cases of fraud.Many STO can also be held on regulated stock exchanges that can be characterized as tokenized IPO. These offerings have benefits, including the potential to deliver significant efficiencies and cost savings.Where Are STOs Legal?STOs are regulated and legalized in several countries where ICOs have not. This makes them the preferred method of fundraising and are fully regulated in following jurisdictions: European Union, Germany, United Kingdom, Switzerland, United States, Canada, Brazil, Australia, Israel, Singapore, Japan, and Hong Kong.In particular, STOs are placed under securities legislation. Even in the aforementioned jurisdictions however, security tokens still require a connection to a registered company with real assets being sold.There is some degree of controversy surrounding security tokens, mainly as a means of their classification. There exists a debate surrounding security tokens as to their legal differentiation of whether they can be characterized as a utility instead of a security. Traditionally, a passive financial return is expected from the investment, thus it is classified as a security. Read this Term firm Securitize said on Tuesday it got the green light from the US regulators to move forward with a duo of acquisitions, a broker-dealer and alternative trading system for digital assets.
The San Francisco-based startup, which helps firms tokenize their securities and assets, got such an endorsement to buy Distributed Technology Markets (DTM) in a bid to enter more regulated markets and reach institutional investors.
Distributed Technology Markets is part of a family of companies, and the acquisition will include taking over its sister company, Velocity Platform, which runs a money services business with money transmitter licenses in several states.
As part of the takeover, the newly acquired entity will be renamed Securitize Markets, which will offer a complete digital suite of services from primary issuance through secondary trading. Jonathan Kelfer, Co-founder and former CEO of Velocity Markets, has been named as the firm’s new CTO.
Regulators Clear Security Token Trading Systems
“By integrating Securitize Markets into our existing digital transfer agent platform and services, we can now offer a seamless digital solution for issuers and investors that dramatically improves the experience compared to the poorly digitized processes that are being used today,” said Securitize CEO and co-founder, Carlos Domingo.
Chris Wittenborn, CEO of Securitize Markets, also noted: "Securitize Markets is continuing the initiative of working hand in hand with regulatory bodies to construct a compliant capital markets framework for private securities - including digital asset securities. We're excited to join forces with Securitize in an effort to continue developing this market."
Securitize will capitalize on DTM’s regulatory approval to operate as an alternative trading system (ATS), which facilitates transactions in securities that are not publicly-traded. It creates a way for companies to tokenize equity and issue it on a blockchain without running afoul of regulatory obligations.
Many Fintech and blockchain firms have responded to US regulators’ classification of certain digital tokens as securities and therefore coming under the SEC’s supervision. Wall Street’s top watchdog says that any entity that wants to become an ATS needs to register with the SEC as a broker-dealer and become a member of a self-regulating organization, such as FINRA.