tZero becomes 2nd FINRA-approved broker-dealer for digital securities

September 11, 2024 Coin Telegraph

The company is following the steps of Prometheum, which now treats four cryptocurrencies as securities.

The United States has a second special purpose broker-dealer (SPBD) for digital asset securities. The Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) have approved tZero Digital Asset Securities as a digital asset SPBD, giving it the right to custody digital asset securities on behalf of retail and institutional clients.

Its new status allows SEC-regulated alternative trading system operator tZero to carry out custody, clearance and settlement of securities without a third-party custodian, making tZero a “one-stop shop” for digital asset security issuance and secondary trading, the company said in a statement. The company helps private companies go public through securities offerings.

tZero has a “long-standing position that many digital assets in the market constitute securities under existing legal frameworks,” it said. Although that claim is widely disputed in the crypto world, tZero will treat digital assets as securities when it provides custody of them. tZERO chief legal and corporate affairs officer Alan Konevsky said:

Tech firm Republic taps Avalanche for profit-sharing investment note

November 17, 2023 Coin Telegraph

Avalanche

The blockchain-based investment note is issued on Avalanche and will automatically distribute profits to holders’ wallets.

Neo-investment and technology firm Republic plans to issue a blockchain-based security token that will pay dividends to retail investors from profits across its broad portfolio of investment holdings.

The Republic Note is a profit-sharing digital asset that will be launched on the Avalanche blockchain, which accrues profits generated from Republic’s wide-ranging investment portfolio and services. Republic has attracted over three million investors and has deployed over $2.6 billion into various ventures, including the likes of Web3 firms Avalanche, DappRadar and Dapper Labs.

Republic has already carried out a presale round for the Republic Note, attracting over $30 million from individual and institutional investors. Dividends from the note are set to be paid out in USD Coin (USDC) to retail investors when the dividend pool reaches a threshold of $2 million.

Republic has also developed a proprietary Web3 self-custodial, cross-chain wallet that will be used to distribute dividends to Republic Note holders. The notes will not be tradeable digital assets like other cryptocurrency tokens and are set to be listed on select securities exchanges in the next two to three months.

Republic president Andrew Durgee highlighted the selection of Avalanche as its blockchain platform of choice as primarily driven by the company’s ambition to reach and scale a broad audience of Web3 native investors:

“Choosing Avalanche goes far beyond the network’s strength, scale, and speed — it solidifies our longstanding partnership with Ava Labs, built on a shared vision of more inclusive financial markets.”

The Republic Note has been a work in progress since 2016 when its white paper was first published. Quantstamp has since audited the digital securities offering.

The website for the upcoming digital security lists the price of a single Republic Note at $0.36. Between 330 and 350 million Republic Notes will be circulating at launch, with the total Republic Note supply capped at 800 million.

As Cointelegraph recently reported, other cryptocurrency ecosystem players have also launched tokenized securities offerings to prospective investors.

Blockchain technology firm Blockstream announced the launch of the Blockstream ASIC Note in August 2023, which allows investors to gain exposure to digital securities paid for in Bitcoin (BTC) that will be used to buy ASIC mining hardware at scale.

Blockstream plans to store and sell the hardware back to the market as demand for ASIC miners picks up into 2024.

Magazine: An investment in knowledge pays the best interest: The parlous state of financial education

Industrial Giant Siemens Issues €60 Million Digital Bond on Blockchain

February 16, 2023 Bitcoin.com

Arca Labs partners with Securitize on regulated, tokenized financial products

September 24, 2021 Coin Telegraph

Arca

As part of its partnership with Arca Labs, Securitize will help launch tokenized financial products for the firm, starting with Arca’s registered tokenized treasury fund.

Arca Labs, the innovation arm of digital asset investment firm Arca has partnered with blockchain tech firm Securitize to launch regulated, tokenized financial products.

According to a Sept. 23 announcement, Securitize has signed on to provide a smart contract and issuance platform for the firm, starting firstly with Arca’s tokenized fund dubbed “Arca U.S. Treasury Fund” that was launched in July 2020.

Arca touts it as the first treasury fund registered under the Investment Company Act of 1940 to issue shares as digital assets via the blockchain. The fund meets the same regulatory requirements as a mutual fund, but differs by offering exposure via Ethereum-based digital asset security tokens called “ArCoin.”

Arca states that the fund will typically “invest a minimum of 80% of assets in U.S. Treasury securities.”

Securitize has taken over the fund’s transfer agent role from TokenSoft, and will be tasked with managing regulatory compliance mandates such as investor verification, know your customer and anti-money laundering policies, along with onboarding clients and issuing the fund’s shares via ArCoin. Securitize is a registered transfer agent with over 200 clients and nearly a half-billion dollars in regulated securities issued in the past three years

The transition has seen the fund’s existing outstanding balances burned and automatically reissued under Securitize’s new smart contract to each shareholder.

Additionally, there will be jointly-offered tokenized financial products that will be announced at a later date.

“Institutions have struggled to meet investor demand because few tokenization companies have met the rigorous regulatory and operational thresholds required by investors,” the announcement stated, adding that the firms are “seeking to channel the growth of fast-developing blockchain technologies within the existing financial services regulatory framework, which we believe to be key for increased investor trust and adoption.”

Digital securities