Securitize and Cantor Fitzgerald have partnered to support blockchain-based initial public offerings (IPOs) and follow-on equity offerings for listed companies, a move that could further expand the use of tokenized securities in traditional capital markets.
The companies said Wednesday that they are developing a framework for primary issuances that would allow companies to raise capital through tokenized securities while remaining within the existing regulatory framework for public offerings. The framework would support both IPOs and follow-on, or secondary, offerings, in which already public companies issue additional shares to raise capital.
Under the agreement, Securitize will provide the tokenization infrastructure used to issue, distribute and service the digital securities. Its SEC-registered broker-dealer affiliate, Securitize Markets, will participate in the offering and settlement process. Cantor will contribute its equity capital markets and trading capabilities typically associated with public offerings.
The announcement comes as tokenized securities gain traction across traditional finance. While tokenization has largely focused on private credit and Treasurys, companies are increasingly exploring blockchain-based infrastructure for public equities as well.
The collaboration builds on an existing relationship between the companies. Securitize, which provides blockchain infrastructure for tokenized real-world assets, went public through a merger with a special purpose acquisition company (SPAC) backed by Cantor Fitzgerald.
Related: Kraken acquires tokenization platform Magna ahead of potential IPO
Tokenized stocks attract Wall Street interest
The market for tokenized stocks has expanded rapidly over the past year, outpacing much of the broader digital asset market. The value of tokenized stocks onchain has increased 16% over the past 30 days to nearly $1.9 billion, according to RWA.xyz.
The value of tokenized stocks has grown rapidly over the past year.
Source: RWA.xyz
The growth is drawing established financial institutions deeper into the sector. As The Wall Street Journal reported Wednesday, the Depository Trust & Clearing Corp. (DTCC) plans to pilot the tokenization of stocks and US Treasurys with nearly 40 financial companies, including JPMorgan and Goldman Sachs. The trial follows DTCC’s May announcement that it aims to roll out tokenized trading services by October.
Assets slated for tokenization include shares of Microsoft (MSFT) and stablecoin issuer Circle (CRCL), as well as exchange-traded funds tracking the S&P 500 index, the Nasdaq 100 index and short-term US Treasury bonds.
Related: US, UK treasuries to align transatlantic rules on tokenization and stablecoins
