Uphold, an exchange for digital currencies, has agreed to acquire New York-based broker-dealer, JNK Securities Corp. in a bid to operate as a regulated broker-dealer, pending approval by federal authorities. Terms of the agreement were not disclosed.
The companies have filed an application with the Financial Industry Regulatory Authority for the approval of the change of ownership and business expansion. Upon FINRA approval, Uphold will file a Form ATS with the Securities and Exchange Commission and can begin operating an alternative trading system.
If the application is approved, the extension of the broker-dealer registration will encompass Uphold’s securities and security-token business and expand the company’s compliance footprint, customer base and service offering.
“We have kept a close eye on statements from global regulators regarding virtual currencies and tokens and believe that many crypto assets (particularly ICO tokens) may be treated as securities in some cases,” said Adrian Steckel, CEO of Uphold.
“Broker-dealer and ATS coverage is key to protecting our customers and to building a preeminent financial services ecosystem. 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,” added Steckel.
Through Uphold’s new securities division, the digital currency platform would be able to offer sales and trading of ICO tokens and fractional equities and provide other exchange services, under the oversight of the SEC and FINRA.
A similar move was made by Coinbase, a $1.6 billion digital currency exchange headquartered in San Francisco, when it acquired broker-dealer Keystone Capital Corp last month.
Uphold is a digital money platform that allows access to traditional currencies, cryptocurrencies, and other investments. The company has powered more than $3 billion in transactions across 184 countries, in over 30 supported currencies and four commodities.