Serving 1.2M Investor Accounts and 3,000 Clients, Securitize Becomes a Top 10 U.S. Stock Transfer Agent, and is the Only Large Transfer Agent Capable of Tokenizing Securities on the Blockchain
Securitize, the digital asset securities firm, today announced its acquisition of Pacific Stock Transfer. With over 1.2 million investor accounts and over 3,000 private and publicly traded clients, Securitize is now one of the top 10 largest stock transfer agencies in the U.S. by accounts, as well as the first and only top 10 transfer agent to issue and manage shares digitally.
As the first and leading transfer agent operating with digital asset securities, Securitize’s acquisition of Pacific Stock Transfer is a significant step in bridging the process of issuing shares and tracking their ownership from its paper-based past, to a blockchain-enabled digital future–including by issuing and managing the shares of publicly-traded companies traded on the NYSE, NASDAQ or OTC.
Securitize is an end-to-end digital asset securities firm that provides a full suite of capabilities for private companies to raise capital, compliantly onboard shareholders, issue both traditional book entry and tokenized shares, service shares throughout their lifecycle, and provide a path to liquidity through secondary market trading. The acquisition provides an opportunity for Pacific Stock Transfer’s clients and their shareholders to access new and value-added complementary services such as capital raising, secondary trading, and the efficiencies of digitized share management leveraging the blockchain.
“This acquisition is a big step forward for Securitize in significantly increasing our ability to introduce new capabilities to more companies, as well as for the financial services industry in general with this major step in building and broadening a ‘blockchain bridge’ from a paper-based past to a digitally native future.”Carlos Domingo, CEO of Securitize
“Securitize’s acquisition of Pacific Stock Transfer will bring significant benefits to both companies and shareholders, particularly PST clients who will benefit from new exposure to capital raising, investment and trading opportunities, as well as the option to tokenize and digitally service their shares as well as their shareholders that will see their experience digitally enhanced,” said Securitize CEO Carlos Domingo. “This acquisition is a big step forward for Securitize in significantly increasing our ability to introduce new capabilities to more companies, as well as for the financial services industry in general with this major step in building and broadening a ‘blockchain bridge’ from a paper-based past to a digitally native future.”
The process of creating and managing shares through paper-based and book-entry transfer agencies continues to be highly inefficient and desperately needs to be modernized, yet is an area where start-ups have not traditionally been focused. Proving share ownership, voting shares, tax reporting, and shareholder communications are all complicated, lawyered-up manual processes. As Dan Primack at Axios reported in December when BuzzFeed investors found themselves unable to sell their shares after the company’s IPO, “I simply couldn’t find a single person outside of the stock transfer firms themselves who had something nice to say. And that means the industry has a big problem, and could be ripe for disruption.”
Securitize became the blockchain-based company to register as a transfer agent in 2019. It creates shares in the form of unique digital tokens which are securely recorded in a decentralized blockchain network, enabling businesses to know the ownership of each share in a unique and irrevocable way and see all trading activity in real time. Because there are no paper files or centralized databases, and transactions are executed instantaneously, the unnecessary expense, inefficiency and risk of human error is eliminated, providing a more economical, secure, fundamentally better experience for businesses and their shareholders.
As the acquisition proceeds, Pacific Stock Transfer will continue to operate under its current brand, the services it currently provides will continue to be provided by the same team, and its clients will also benefit from increased exposure and access to digitized services.
“For over 38 years, Pacific Stock Transfer has been one of the most important companies most people have never heard of: from creating shares to tracking ownership to voting, tax, reporting and more, we do all the heavy lifting that enables businesses and shareholders to own and trade stocks,” said Billy Miller, Chief Operating Officer of Pacific Stock Transfer, and who will continue to lead the business at Securitize. “Pacific Stock Transfer has already made this process more efficient for our clients through our DTC / Fast Automated Securities Transfer service, and integration with blockchain-based recordkeeping will enable us to provide significantly better and more efficient service to our clients and their shareholders in the future.”
“Over the past four years, Securitize helped more than 200 businesses raise capital or digitally manage their shares, and provided a means for nearly 450,000 investor accounts to access shares in private businesses and other alternative assets in a regulatory compliant way,” said Scott Harrigan, CEO of Securitize Markets. “Our acquisition of Pacific Stock Transfer represents a six-fold increase in the number of clients and three-fold increase in the number of shareholders who will be exposed to investing and trading opportunities on the Securitize Markets platform.”
The transaction closed on Wednesday, February 16.
Securitize is a digital asset securities firm with a mission to provide shareholders access to invest in and trade alternative investments, and for companies to raise capital, manage shareholders, and offer shareholders potential liquidity. Securitize has pioneered a fully digital, end-to-end platform for issuing, managing and trading digital asset securities, consistent with the existing U.S. regulatory framework, with over 1.2 million investor accounts and 3,000 businesses connected. Securitize is comprised of Securitize, Inc. and its subsidiaries Securitize, LLC (an SEC-registered transfer agent), Securitize Capital, LLC, Securitize Markets, LLC (an SEC-registered broker-dealer, member of FINRA and SIPC, and operator of the company’s alternative trading system), and Pacific Stock Transfer.
Image by Jan Senderek on Unsplash
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