By Staff Writer
Blockchain-based investment bank Securitize has become the first company to be registered with the Securities Exchange Commission to act as a digital transfer agent, allowing it to carry out such functions such as the payment of dividends on the distributed ledger, according to a statement.
The move is seen as a major boost to the firm’s mission to modernize capital markets by creating a one-stop-shop digital securities investment bank. The license also allows the firm to act as a transfer agent for digital securities, sometimes known as securities tokens, as well as issuers of Reg A+ and Reg CF digital securities that wish to exempt their digital securities from the mandatory registration requirements of Section 12(g) of the Securities Exchange Act of 1934.
“Becoming a registered transfer agent is the natural next step for Securitize as we continue to work toward making all securities digital,” Carlos Domingo, Co-Founder and CEO of Securitize said in a statement.
Securitize allows digital securities — powered by the firm’s DS protocol — to be traded on SEC-registered alternative trading systems (ATS), including Open Finance Network, tZERO, and Sharespost. It recently announced its 10th digital security running on its platform, with the total value of issued and outstanding digital securities approaching $200m.
Becoming a transfer agent allows Securitize to keep a real-time cap table of investors and facilitate corporate actions for issuers, including, among other things, the payment of dividends and interest, conducting shareholder votes and redemptions/share buybacks.
Securitize has also created a tool, the transfer verification tool (TVT), that allows investors to pre-check the transfer of any digital security token powered by the DS protocol.
The move positions Securitize as a one-stop-shop digital securities service provider, drastically decreasing the number of intermediaries required to manage the lifecycle for both registered and unregistered digital securities on the blockchain.
For more information on securities token and how Securitize is revolutionizing the industry, please read our exclusive interview with Securities CEO Carlos Domingo (see here) and our story on how to create legally-compliant securities token mean (see here).