Prometheum bets Wall Street distribution is the missing link for tokenized securities

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Prometheum bets Wall Street distribution is the missing link for tokenized securities Crypto has solved tokenization, but not distribution and Prometheum says broker-dealers and RIAs are the key to bringing digital assets into mainstream finance. What to know: - Prometheum launched new infrastructure allowing broker-dealers and RIAs to offer tokenized securities and crypto assets through traditional brokerage accounts. - Aaron Kaplan, co-founder and co-CEO of Prometheum says tokenization has advanced faster than distribution, leaving blockchain-based securities without mainstream investor access. - The company is betting regulated Wall Street firms will drive the next phase of digital assets by bringing onchain securities into traditional financial channels. Prometheum is betting that the next phase of tokenized finance will be won not by crypto exchanges, but by traditional broker-dealers and registered investment advisers (RIAs). "The story of tokenization so far has been about issuance, but no one has addressed the challenge of how to get those products to mainstream investors," Aaron Kaplan, co-founder and co-CEO of Prometheum told CoinDesk in an interview. "Until tokenized and digitally-native securities can reach investors through the broker-dealer channels they already use, tokenization is a solution without a market," he added. Tokenized securities are traditional financial assets such as stocks, bonds or funds that are issued and traded on blockchain networks as digital tokens representing ownership or investment rights. The New York-based digital asset infrastructure firm recently launched Prometheum Capital’s Digital Brokerage Solutions, a suite of correspondent clearing, custody and trading services designed to let broker-dealers offer crypto assets, including tokenized securities and other blockchain-based financial products, directly through traditional brokerage accounts. The launch marks Prometheum’s latest attempt to bridge the gap between the crypto industry and the regulated securities ecosystem. “Crypto has solved tokenization, but it hasn’t solved distribution,” Kaplan says. “There are tens of billions of dollars of tokenized securities already issued on blockchain rails, but almost no mainstream distribution channel to reach investors at scale.” Prometheum operates a network of SEC-registered and FINRA-member broker-dealers designed to support the full lifecycle of blockchain-based securities, including issuance, trading, custody, clearing and settlement. The company positions itself as a bridge between traditional financial markets and digital assets, offering regulated infrastructure for tokenized securities, crypto assets and onchain financial products through existing brokerage and securities law frameworks. It operates a network of regulated entities spanning the digital asset lifecycle, including a transfer agent, broker-dealer, alternative trading system (ATS), custody platform and correspondent clearing infrastructure. Kaplan described the firm’s clearing-enabled custodian as its “special sauce.” Prometheum joined the Depository Trust & Clearing Corporation (DTCC) Industry Working Group in May as one of more than 50 financial firms helping shape the development of the Depository Trust Company’s (DTC's) tokenization service. Building a distribution flywheel The company says its platform serves two primary functions: helping issuers distribute tokenized securities into the broader financial system and enabling traditional broker-dealers to build digital asset businesses without relying on crypto-native exchanges. That creates what Kaplan calls a “flywheel effect,” connecting issuers with institutional distribution channels while giving traditional financial firms access to the growing market for blockchain-based assets. Prometheum’s inaugural correspondent clearing clients include Arete Wealth Management, Network 1 Financial Securities and an unnamed clearing broker-dealer, according to a company statement. Kaplan says the broader opportunity lies in opening the broker-dealer and RIA channel, long the dominant distribution network for traditional securities, to digital assets. “The broker-dealer channel is how you reach investors at scale,” he says. “Now, for the first time, broker-dealers and RIAs can offer digital assets directly through their existing account structures and compete with crypto trading venues on a more level playing field.” Competing with crypto platforms under securities rules Prometheum argues that traditional securities firms have largely been sidelined during crypto’s rise because many digital asset platforms operated outside conventional securities regulation. By bringing blockchain-based assets into a regulated broker-dealer framework, Kaplan says firms can compete while maintaining investor protections such as asset segregation, custody controls and compliance oversight. “It’s a tried-and-proven regulatory structure that has allowed investors to thrive for generations,” Kaplan says. “Now it can support digital assets as well.” The company is positioning itself around the idea that the future of securities markets will ultimately move onchain. Kaplan points to growing industry projections that tokenized real-world assets (RWA) could become a major segment of capital markets over the next decade. “The future of securities is onchain,” he says. “As these products become better, faster and cheaper, broker-dealers are going to need the infrastructure to compete and offer them to clients.” More broker-dealers and RIAs expected to join Prometheum says additional broker-dealers and RIAs are expected to onboard in the coming months as demand grows for regulated digital asset infrastructure. Kaplan also teased an upcoming institutional distribution partnership that he says will help attract larger issuers into the ecosystem. The broader thesis reflects a shift underway across the digital asset industry, where firms are increasingly focused less on token creation and more on integrating blockchain-based assets into existing financial distribution networks. For Prometheum, the bet is that tokenization alone is not enough. Without Wall Street’s distribution machinery, digital securities risk remaining a niche product despite the technology’s promise. According to Kaplan, "integrating blockchain into capital markets isn’t about replacing the system, it’s about modernizing it so that issuers, broker-dealers, and investors all benefit from faster settlement, broader access, and more efficient distribution of investment products." "Realizing those benefits at scale depends on infrastructure that can move onchain products through the channels investors and advisors already use, and that is what Prometheum has built," he added. More For You A Coinbase executive called on regulators to implement sensible crypto regulation, while announcing the Stand With Crypto event taking place in over 500 locations worldwide. What to know: - Coinbase says it is unconcerned by growing competition from traditional financial institutions, arguing that crypto’s grassroots community support cannot be replicated by Wall Street. - Stand With Crypto, which Coinbase calls the world’s largest crypto-advocacy group, claims 3.7 million members who have contacted lawmakers more than 2.5 million times, even as...

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