Today Securitize announced that it is acquiring wealth management startup OnRamp Invest. OnRamp supports financial advisors who offer cryptocurrency services to their clients and through this merger Securitize will be able to offer its tokens to the advisors. Registered investment advisors (RIAs) on the OnRamp platform have combined assets under management of $40 billion (not just crypto).
Securitize is best known for providing tokenization services for stocks of private firms as well as alternative assets such as KKR and Hamilton Lane private equity funds.
“Onramp already offered RIAs easy access to digital assets, so it is a very natural extension to offer them tokenized alternative assets to complement their portfolios,” said Securitize CEO Carlos Domingo. “Most wealth is generated in private market alternative assets and bringing Securitize and Onramp together enables registered investment advisors to give their clients access to that wealth generation.”
The two companies already had a relationship. Back in March Onramp Invest announced that four private equity feeder funds tokenized by Securitize would be made available to advisors on its platform.
According to Crunchbase, OnRamp Invest raised a total of $13 million with its most recent funding coming from JAM FINTOP, the fintech initiative that supports regional banks. Softbank was also an investor. Securitize’s most recent funding round was two years ago when it raised a $48 million Series B that included Morgan Stanley and IDC.
A few recent crypto acquisitions have fallen through. The one question regarding this transaction relates to custody. Some of the assets on the OnRamp platform were held in custody by Prime Trust which filed for Chapter 11 protection this week. It has been claimed that Prime Trust has a shortfall in cash held for clients.
