Carlos Domingo, chief executive officer of Securitize Inc., speaks during the Messari Mainnet summit in New York, US, on Thursday, Sept. 21, 2023.
Michael Nagle | Bloomberg | Getty Images
Securitize surged Thursday after federal regulators greenlit the issuing of tokenized stocks on some trading platforms in the U.S.
The tokenization name was last up 14%. At its peak, it was up 24%.
The Securities and Exchange Commission earlier in the day announced a temporary path for the limited trading of tokenized publicly traded U.S. stocks. The order, though not a formal regulation change, will remain in force for five years.
SECZ 5-day chart
“The Innovation Exemption is designed to resolve challenges that have prevented responsible innovation from taking root in the United States while providing investor protections and market integrity standards,” SEC Chair Paul Atkins said in a statement.
Tokenization refers to the process of registering ownership rights for real-world assets like bonds and stocks on a digital decentralized ledger. The technology makes it possible to trade financial assets around the close, giving tokenized securities an edge over their traditional counterparts.
Securitize became the first major tokenization firm to go public in the U.S. in early July. It holds roughly 9% of the tokenized market by assets under management, priming it to reap the rewards of a boom in real-world asset tokenization, according to Needham Securities.
The combined market value of tokenized assets has soared to $38.51 billion as of Thursday afternoon, up more than 70% over the past year, according to data provider RWA.xyz.
“We believe the long-term leaders will be those platforms that can secure the broadest base of inst. customers. SECZ has done this having launched two funds with BlackRock, Apollo, KKR, and others and has infra. partnerships with Computershare and NYSE,” Needham analyst John Todaro wrote last week.
He initiated coverage of the stock with a buy rating.