San Francisco-based cryptocurrency exchange Uphold Inc. announced on Wednesday that it has reached a deal to acquire regulated broker-dealer JNK Securities Corp., which is also a member of the New York Stock Exchange (NYSE). The terms of the transaction were not revealed.
Along with the deal, Uphold says it has filed an application seeking regulatory approval for the transaction with the U.S. Financial Industry Regulatory Authority.
“If the application is approved, the extension of the broker-dealer registration will encompass Uphold’s securities and security-token business and expand our compliance footprint, customer base, and service offering,” said Uphold CEO, Adrian Steckel, in a blog posting announcing the deal. “The acquisition will also offer JNK clients access to all of Uphold’s crypto to fiat trading pairs and assets, introducing our platform to a new group of institutional investors.”
The firm indicates that its new securities division will offer trading in initial coin offering (ICO) tokens and fractional equities, and provide other exchange services, under regulatory oversight.
The deal follows a growing push by regulators to treat digital assets, such as ICOs, as securities, Steckel noted.
“Broker-dealer and [alternative trading system] coverage is key to protecting our customers and to building a preeminent financial services ecosystem,” he said. “We are proud to be a compliant financial services company, working with regulators to ensure we provide the most trusted and transparent access to digital financial services worldwide.”