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, thereby bridging traditional Wall Street infrastructure with blockchain technology. This agreement allows publicly listed companies to introduce tokenized equity, known as Issuer-Sponsored Tokens (ISTs), in addition to their existing shares. This provides investors with the flexibility to hold stocks either through traditional systems or in a digital wallet. The initiative is part of a broader effort to integrate tokenized shares into the current market rules while offering novel ways to hold and transfer assets, including wallet-based ownership and 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 circumvent a common workaround in the crypto space, where tokens represent claims on shares rather than the actual shares themselves.
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 a $2.5 billion tokenized money market fund for BlackRock and assisting the New York Stock Exchange in building 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 serve 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 similar to other recent initiatives in this space, the blockchain component operates primarily in the background. The tokens are designed to represent direct ownership, rather than derivatives layered on top of existing stocks. "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 lend scale to this effort.
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.