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Figure Securities has been approved as a broker-dealer by the Financial Industry Regulatory Authority, with its blockchain-based trading system given the go-ahead by the U.S. Securities and Exchange Commission (SEC).
The news means the California-based firm is now clear to operate as a broker dealer for blockchain-based securities, having secured all the necessary permissions to do so, in a move the company expects to have an impact on the wider financial services sector.
In a statement, co-founder and CEO Mike Cagney described the development as a “transformational event” for both the company and the wider industry.
“Being approved as a broker-dealer and being able to operate our [Alternative Trading System] is a transformational event for our company that will have significant impact across the financial services sector.”
Per the announcement, Figure’s service will rely on blockchain technology for cap table management, the creation of security tokens, and to provide a variety of services to fund managers.
Securities are to be stored on the Provenance blockchain, a blockchain set up specifically to cater to the needs of the financial services sectors. From there, they can be exchanged or traded on the blockchain as required.
The news means Figure Securities is positioned to serve the growing interest in blockchain securities from investors of all kinds, including institutional investors increasingly keen on blockchain securities and other digital assets.
Figure has also joined forces with Provenance to offer digital loans via the Provenance Marketplace, allowing for instant loan performance data and same-day settlement on the blockchain.
Figure has previously turned to Provenance for its asset-backed securitization, the first blockchain securitization of its kind, back in March 2020.
Firms can only offer blockchain-based securities in the U.S. with prior approval of the SEC and other regulators.
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