In a significant move, Securitize, backed by BlackRock, and Computershare are set to bring a substantial portion of the $70 trillion US stock market onto the blockchain through tokenized equities, bridging the gap between traditional Wall Street infrastructure and blockchain technology. The agreement enables listed companies to introduce tokenized equity, known as Issuer-Sponsored Tokens (ISTs), alongside their existing shares, providing investors with the flexibility to hold stock through traditional systems or a digital wallet.
This effort is part of a broader initiative to make tokenized shares compatible with current market regulations while offering novel ways to hold and transfer assets, ranging from wallet-based ownership to expedited settlement. Transfer agents, such as Computershare, play a pivotal role in this system by maintaining shareholder records and handling corporate actions. By integrating at this level, the companies aim to avoid a common workaround in the crypto space, where tokens represent claims on shares rather than the actual shares.
Securitize is a blockchain-based firm that enables the issuance, trading, and management of real-world assets, such as equities and funds, in tokenized form on blockchain networks. The firm is renowned for issuing BlackRock's $2.5 billion tokenized money market fund and for collaborating with the New York Stock Exchange to build its tokenized equity platform. It also plans to go public later this year through a SPAC deal with Cantor Equity Partners II (CEPT).
The Convergence of Blockchain and Transfer Agents Under this setup, Computershare will act as the transfer agent for tokenized shares, just as it does for traditional shares, including managing records and processing events like dividends or stock splits across both formats. Securitize provides the underlying technology, but the blockchain component remains largely in the background, similar to other recent efforts in this space. The tokens are designed to represent direct ownership, rather than derivatives layered on top of existing stock. "ISTs do not rely on derivative tokens that sit on top of underlying shares," stated Securitize CEO Carlos Domingo.
"They provide US issuers with the ability to create direct equity ownership in token form." Computershare's extensive reach could give this effort the necessary scale, as the firm serves over 25,000 companies and acts as a transfer agent for approximately 58% of the S&P 500. The structure also allows issuers to maintain control over their shareholder base, a crucial requirement for public companies. "Our focus has been to empower US-listed companies to issue tokenized equity while retaining control," said Ann Bowering, CEO of issuer services at Computershare North America.