Should Tokenized Stock Only Come From Issuers? Yes, Says Carlos Domingo

**Carlos Domingo** (0:00)
I think Tom Farley, the CEO of Bullish, posted the other day something very interesting. He said, look, I'm the CEO of Bullish, and then there's somebody that has created a derivative of Bullish Equity that trades offshore without KYC in a permissionless environment. So as a CEO, I can actually, my CFO, let's say, can go there and buy or sell those derivatives completely anonymously the day before the earning announcements. And this obviously breaks a million different rules, as you can imagine, because you're an insider and you're not allowed to trade before earning announcements because you know what's going to happen or you can know whether the results are good or bad and how the stock is going to move.

**Laura Shin** (0:39)
Hi, everyone. Welcome to Unchained, your no hype resource for all things crypto. I'm your host, Laura Shin. Thanks for joining this live stream, but just so you know, this was pre-recorded a few weeks before. This episode is brought to you by CAPE, America's privacy-first mobile carrier. Same premium service you'd expect from any other carrier, but designed so your number, your location and your data actually stay yours. Get 33% off six months at cape.co.
Today's guest is Carlos Domingo, founder and CEO of Securitize. Welcome, Carlos.

**Carlos Domingo** (1:16)
Thanks for having me again, Laura.

**Laura Shin** (1:18)
Yeah, nice to see you and congratulations on your IPO.

**Carlos Domingo** (1:22)
Thank you.

**Laura Shin** (1:23)
For a long while, there's been a trend where startups stay private for longer, which obviously we're seeing with a lot of these AI companies and things everybody's excited about. But Securitize went in a different direction. So why did Securitize decide to go public earlier than is typical nowadays?

**Carlos Domingo** (1:40)
Well, first, from an age perspective, we are more than eight years old. So I think we've been around for a while. From a size perspective, we're a lot smaller than some of the companies that stay private longer.
But when I started in tech, it was the opposite. Companies used to IPO as soon as possible because you get access to public markets, you then have the credibility of being publicly traded, your equity becomes liquid. I remember companies like Amazon, et cetera, they IPO when there were like a few hundred million dollars in market cap, right? And somehow in the middle, I think it was Google and Facebook and these companies that started delaying, delaying, delaying, going public and everything became private markets. But I think-

**Laura Shin** (2:21)
So why was this the right time for you?

**Carlos Domingo** (2:24)
For us, it was the right time because first, the IPO market was open for crypto companies after many years. As you know that since the Coinbase IPO, I guess that there was no other crypto IPO except for miners.
So we IPO after or we started the process when we saw that Circle was going public and other companies like Gemini or eToro, later Bitgo, et cetera, were also planning to go public. So talking to bankers, they told us, yes, definitely the market is open. The second thing is, as I mentioned, we were already eight years old. We've been growing a lot the last couple of years. Tokenization was a huge narrative in the industry. I think that the Circle IPO was very inspiring because Circle tokenizes dollars, we tokenize everything else and the amount of attention and interest they got from public markets was an eye-opening for us in terms of the interest that could be in our company.
The final thing is a couple of more things. One is obviously most of our counterparties are very large, traditional financial services companies, so I think going public and make sure that they don't have any concerns about the long-term viability of the company because now they can see our balance sheet, they can see how much hundreds of millions of dollars we have there, and that we're not going to go out of business anytime soon. It give us also credibility with our customers. And the final thing is that I think crypto is going to consolidate. I mean, you and I have been in this industry for a very long time, and there's a lot of M&A happening now, but it hasn't really been, I think, for many, many years. And I guess part of the reason is precisely because there's no public literary companies, right? And when you're private, it's a lot more difficult to acquire another company. When you're public, the price of your company is set by the market, your stock is liquid, so they're not taking the same risk, taking private shares in another company, et cetera. And we thought that this was a good opportunity to reinforce the balance sheet, provide visibility and credibility to the company and then being able to tap into the M&A market.