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 blockchain through tokenized equities, bridging traditional Wall Street infrastructure with blockchain technology. The agreement allows publicly listed companies to introduce tokenized equity, known as Issuer-Sponsored Tokens (ISTs), in addition to their existing shares, providing investors with the option to hold stocks through either traditional systems or digital wallets. This initiative is part of a broader effort to integrate tokenized shares into current market regulations while introducing new methods for holding and transferring assets, including wallet-based ownership and expedited settlement.
As a key player in this system, transfer agents like Computershare maintain shareholder records and handle 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 shares themselves. Securitize, a blockchain-based firm, specializes in issuing and managing real-world assets, such as equities and funds, in tokenized form on blockchain networks.
Notably, the firm has issued a $2.5 billion tokenized money market fund for BlackRock and has collaborated 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 partnership between blockchain technology and transfer agents is a significant development. Under this setup, Computershare will serve as the transfer agent for tokenized shares, managing records and processing events like dividends or stock splits across both formats.
Securitize provides the underlying technology, with the blockchain component operating largely in the background. The tokens are designed to represent direct ownership, rather than derivatives layered on top of existing stock.
According to Securitize CEO Carlos Domingo, "ISTs do not rely on derivative tokens that sit on top of underlying shares. They provide US issuers with the ability to create direct equity ownership in token form." The reach of Computershare, which serves over 25,000 companies and acts as a transfer agent for approximately 58% of the S&P 500, could give this effort the necessary scale.
This structure also allows issuers to maintain control over their shareholder base, a crucial requirement for public companies. As Ann Bowering, CEO of issuer services at Computershare North America, stated, "Our focus has been to empower US-listed companies to issue tokenized equity while retaining control."