Securitize, a digital securities platform backed by major cryptocurrency exchange Coinbase, has announced a new tool that assures that secondary market transactions of digital securities are compliant with regulations.
According to an April 22 blog post, Securitize Instant Access streamlines the creation of compliant peer-to-peer transactions by investors in private securities. To ensure that transactions meet the necessary requirements, Securitize uses smart contracts on the Ethereum blockchain.
To initiate a transaction, investors privately create an indication of interest to sell their digital securities with a web link, which can be posted and shared across various channels. The blog post further detailed:
“Once an issuer decides to enable the Instant Access feature, any potential buyer who has KYC/AML approval from, and is registered with the issuer, can purchase the digital security from the holder if the holder has shared the transaction link with them. Only transactions that meet these KYC/AML requirements and adhere to any applicable transfer restrictions imposed by the issuer via the DS Protocol will be permitted.”
Securitize is currently offering instant trading of private securities linked to five companies, including venture capital funds, the startup’s co-founder and CEO Carlos Domingo told Bloomberg.
Securitize’s steady development
In March, Securitize and Tokyo-based LIFULL revealed plans to jointly create a funding platform using digital securities to invest in real estate. The new platform aims to revitalize homes in Japan that have fallen into disuse or been abandoned entirely.
Last August, the United States Securities and Exchange Commission registered Securitize as a transfer agent. The registration allows the company to operate as an official keeper of records about changes of ownership in securities.