Securitize, a digital assets securities firm, has launched a secondary marketplace for trading tokenized shares of private companies under a subsidiary called Secuiritize Markets.
Securitize has been issuing security tokens since 2017 through its U.S. Securities and Exchange Commission-registered transfer agent. Now it can sell and trade them through its alternative trading system (ATS), which is run by its broker-dealer. (Securitize acquired both the broker-dealer and ATS licenses last year).
“We want to facilitate liquidity to companies earlier on without having to go through the expensive and lengthy process of registering with the SEC,” said Securitize CEO Carlos Domingo. “We also want to give the opportunity to individual investors to invest in these companies early on and get a return that is otherwise not available to the public.”
The marketplace is launching with four issuers, mostly venture capital firms in the blockchain and digital assets space, but Securitize plans to draw in firms from outside the crypto ecosystem in the future. In the coming weeks four more issuers are expected to join, including digital wallet firm Exodus, which also issues security tokens on tZero.
It took Securitize three months to transfer the license and another eight months to get the final regulatory approval to launch, said Scott Harrigan, CEO of Securitize Markets.
“Because of the stringent regulatory requirements imposed on alternative trading systems (ATSs), it understandably took some time for regulators to review and fully vet our application to operate the digital asset security ATS,” Harrigan said.