Securitize gains SEC adviser status as SECZ falls 10%

Securitize expanded its regulated US platform after its capital subsidiary registered with the SEC, while SECZ shares fell nearly 10% on Monday.

Securitize Capital becomes an SEC-registered adviser

Securitize said Monday that its subsidiary, Securitize Capital LLC, has registered with the US Securities and Exchange Commission as an investment adviser.

The registration became effective on July 22, according to the SEC’s Investment Adviser Public Disclosure database. The Miami-based business had operated as an exempt reporting adviser in Florida since March 2023.

That earlier status generally restricted the unit to advising venture capital funds or private funds with less than $150 million in US assets under management. Full registration removes those limits but brings additional disclosure, compliance, recordkeeping and examination duties under the Investment Advisers Act of 1940.

“Becoming an SEC-registered investment adviser is an important step in the continued expansion of Securitize’s platform,” co-founder and CEO Carlos Domingo said.

“Asset managers and institutional investors want to work with partners that understand both the opportunity of tokenization and the obligations that come with operating in regulated markets.”

The company noted that registration does not represent an SEC endorsement or indicate a particular level of skill or training.

SEC status expands Securitize’s US regulatory stack

Securitize Capital’s registration completes a broader group of regulated services covering the issuance, management and trading of tokenized securities.

Securitize Markets operates as an SEC-registered broker-dealer and runs an SEC-regulated alternative trading system. Other affiliates provide transfer-agent and fund-administration services. FINRA also approved Securitize Markets in May to custody tokenized securities and support atomic settlement.

The expanded structure could allow Securitize to work more closely with asset managers building onchain vaults, lending products and other portfolio strategies. The company reported more than $5 billion in assets under management as of July across products linked to BlackRock, Apollo, BNY, Hamilton Lane, KKR and VanEck.

BlackRock’s BUIDL tokenized Treasury fund accounts for about $2.6 billion of that total.

The registration follows SEC Commissioner Hester Peirce’s July 22 warning that managing certain vaults and lending strategies may create investment adviser obligations. Peirce urged businesses operating within the securities market to engage with the regulator while developing compliant onchain products.

SECZ falls despite Citi’s bullish price target

SECZ shares fell over 10% during Monday trading to about $6.76, giving Securitize a market capitalization of slightly under $1 billion per data from Yahoo Finance. The decline extended the stock’s losses since its New York Stock Exchange debut earlier in July.

Citi analyst Peter Christiansen separately initiated coverage with a Buy rating and a $10 price target. The target represented about 34% upside from Friday’s closing price of $7.47.

Christiansen described Securitize as important infrastructure for real-world asset tokenization but identified several risks. These included the company’s reliance on BlackRock’s BUIDL fund, exposure to interest-rate changes and uncertainty over the development of higher-margin transaction revenue.

Securitize pushes IPOs and public stocks onchain

Securitize entered public markets on July 2 through a merger with Cantor Equity Partners II that generated about $400 million in gross proceeds. It also tokenized its own SECZ shares on the listing date.

Cantor and Securitize later announced a July 15 partnership designed to incorporate blockchain infrastructure into IPOs and follow-on stock offerings. Cantor will provide capital-markets and trading services, while Securitize will manage the issuance, distribution and servicing of tokenized securities.

Unlike products that create blockchain representations of stocks already trading on exchanges, the arrangement would place onchain infrastructure within the original securities issuance process.

Hanwha Group has also emerged as Securitize’s largest shareholder. SEC filings show that the South Korean conglomerate controls 15.69 million shares through affiliated entities and investment vehicles, equal to a 9.6% stake.

Securitize is also working with the NYSE on infrastructure for the exchange’s planned tokenized securities platform. The adviser registration gives the company another regulated US entity as it expands from issuing tokenized funds into portfolio management and public-market settlement.