Securitize Corp. (SECZ) fell 9.77% to $6.74 after the company announced expanded regulatory approval in the United States for its investment advisory subsidiary. The move strengthens Securitize’s regulated platform for tokenized financial services and broadens its ability to support institutional onchain investment products.

SEC adviser registration broadens Securitize platform

Securitize said its subsidiary, Securitize Capital LLC, has registered with the U.S. Securities and Exchange Commission as an investment adviser. The registration became effective on July 22, after the subsidiary had previously operated as an exempt reporting adviser.

The new status gives Securitize Capital broader regulatory authority while subjecting the business to stricter compliance standards. Under federal securities laws, the registration adds disclosure, recordkeeping, compliance and regulatory examination requirements.

The approval expands Securitize’s existing U.S. regulatory structure for tokenized capital markets. The company already operates an SEC-registered broker-dealer, an Alternative Trading System, a transfer agent and fund administration services. Investment adviser registration adds another regulated function to its onchain financial platform.

For institutions, that regulatory stack is central because tokenized securities still rely on conventional securities-law functions, including issuance, custody, trading, transfer records and investment oversight. Securitize said the registration will allow deeper engagement with asset managers and institutional market participants. The company also expects the approval to strengthen portfolio management services for tokenized investment strategies.

Adviser status supports institutional tokenization strategy

The registration removes operating limitations tied to Securitize Capital’s previous exempt reporting adviser status. Those rules generally limited advisory activities to venture capital funds or smaller private funds. Securitize Capital can now expand its advisory business under the Investment Advisers Act of 1940.

Securitize continues to build infrastructure for tokenized securities across issuance, trading and administration. Securitize Markets operates the company’s regulated trading platform, while affiliated entities provide transfer agent and fund administration services.

FINRA approved Securitize Markets earlier this year to custody tokenized securities and support atomic settlement, a process in which the exchange of assets and payment can be completed as a single coordinated transaction. The expanded structure positions the company to support institutions developing onchain lending products, tokenized vaults and portfolio strategies.

Securitize reported more than $5 billion in assets under management during July. Those assets include products associated with BlackRock, Apollo, BNY, Hamilton Lane, KKR and VanEck. BlackRock’s BUIDL fund accounts for roughly $2.6 billion.

Stock declines as Citi starts coverage with Buy rating

The adviser registration comes amid regulatory discussion of blockchain-based investment products. SEC Commissioner Hester Peirce recently indicated that certain crypto vaults and lending strategies may create investment adviser obligations. The approval places Securitize within those evolving regulatory expectations for onchain financial services.

Citi initiated coverage of Securitize with a Buy rating and a $10 price target. The firm described Securitize as an important infrastructure provider for real-world asset tokenization, a market focused on representing traditional financial assets such as funds, securities or cash-like instruments on blockchain rails.

Citi also cited several risks, including concentration around BlackRock’s BUIDL fund, exposure to interest rates and uncertainty over future transaction revenue growth.

Securitize entered the public markets on July 2 through its merger with Cantor Equity Partners II, raising approximately $400 million in gross proceeds. On the listing date, the company also tokenized its own SECZ shares.

Securitize later partnered with Cantor to integrate blockchain infrastructure into future IPOs and public stock offerings. Hanwha Group became Securitize’s largest shareholder with a 9.6% stake, and the company continues to support the New York Stock Exchange’s planned tokenized securities platform.