Blockchain Capital Spearheads $12.75 Million Fundraising Round In Securitize

Kevin O'Brien

Securitize, a startup focused on helping entities create blockchain-based security tokens, has raised $12.75 million through its Series A fundraising round, according to TechCrunch.

The round was spearheaded by Blockchain Capital and featured participation from Coinbase Ventures, the VC arm of the well-known exchange, Ripple’s Xpring fund, and Global Brain.

The investment funds came primarily in the form of fiat. Any tokens recieved will either be held as stablecoins or converted into fiat.

Looking To Shake Up The Securities Industry

According to Securitize’s website, the use of digital securities helps “modernize raising capital” through “upgrading a traditional illiquid, tedious, and costly process.”

CEO and founder Carlos Domingo told TechCrunch how the company is looking to tokenize shares in order to engender transparency and foster more trading with better liquidity.

Securitize does not plan to get involved with trading. Instead, they are focused on building and promoting the frameworks for companies to actually launch security tokens through what is being called a “Digital Security Offering.”

Domingo noted his company has been working with legal counsel in the United States in order to offer services across a variety of states.

He is also considering expansion overseas, but is currently set on releasing Securitize’s own security token once there is more business stability.

Are Security Tokens The Wave Of The Future?

Domingo mused how “2019 will be the year that you see 10-15 exchanges trading securities in a legal way.”

Interest in security tokens has been bolstered through the release of a SEC announcement on November 16th that, according to some, seemed to amount to an endorsement of the concept of securities tokens.

In June, SharesPost Managing Director Rohit Kulkarni wrote how “2019 will belong to the security token.” He speculated it would become a bridge between traditional finance and blockchain while still providing value to each.

Adrian Lai of the South China Morning Post (SCMP) wrote on Novemebr 26th how security tokens are a “much more practical concept” for regulators since requirements such as KYC and AML can be transparent.

Estimates are the broader transition of conventional financial assets towards blockchain could represent a potential market of up to $24 trillion, according to the SCMP.