- tZERO acquired broker-dealer approval, enabling it to hold and sell digital asset securities.
- The company intends to expand into private securities and digital asset custody by early next year.
As a seasoned crypto investor with over a decade of experience navigating the rollercoaster ride that is the digital asset market, I find the recent developments at tZERO particularly intriguing. Having witnessed the rise and fall of countless projects, it’s refreshing to see a company like tZERO, backed by industry heavyweights such as Overstock and the Intercontinental Exchange (ICE), making significant strides towards legitimizing the crypto space.
tZero Group Inc., which is backed by Overstock, has partnered with Prometheum Inc. as one of the two American firms granted special-purpose cryptocurrency broker-dealer status. The newly established corporation, supervised by the Securities and Exchange Commission (SEC), aims to offer digital asset storage and innovative financial services. tZero aims to roll out these services starting in early 2024.
As an analyst, I’m here to explain the role of the special-purpose broker-dealer license that tZero has acquired. This license empowers them to safeguard their clients’ digital asset securities. However, it’s crucial to note that tZero, like Prometheum, adheres to the Securities and Exchange Commission’s (SEC) contentious viewpoint that most cryptocurrency tokens qualify as securities. This classification is a topic of debate within the broader crypto market. Many issuers of these tokens, however, disagree with this designation, preferring to keep their tokens classified differently.
David Goone, the CEO of tZero, showed excitement about the new license and stated that “Gaining special purpose broker-dealer status allows us to provide secure, regulated, and reliable digital asset custody, as well as other advanced products for issuers, investors, and market participants.
tZERO Expands its Digital Asset Services
tZero, backed by Overstock and the Intercontinental Exchange (ICE), plans to introduce a range of services within the next year. These services encompass private securities, real estate, art, and sports assets that have been digitized. The company is initiating its operations with the digitalization of its Series A preferred equity asset, TZROP. Previously, tZero managed an alternative trading system (ATS) for digital asset securities trading; however, the new license expands to include full custody, clearing, and settlement services.
As an analyst, I’m excited to share some intriguing updates from tZERO. Their Vice President has hinted at upcoming developments, expressing on social media their eagerness to leverage their unique resources and strengthen their stance in the rapidly advancing world of blockchain technology.
At a crucial juncture, when the sector faces heightened regulatory oversight, especially regarding the categorization of digital assets, the authorization arrives. Notably, at present, the Financial Industry Regulatory Authority (FINRA) hasn’t revised its BrokerCheck service to incorporate tZERO’s approval yet.
Despite this development, tZero’s status has yet to be verified by the Financial Industry Regulatory Authority’s BrokerCheck. The particular differences between tZero’s and Prometheum’s licenses are unclear.
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2024-09-16 13:44