The financial technology subsidiary of Salt Lake City’s Overstock.com Inc., t0.com Inc. (tZERO), has purchased a 24 percent interest in StockCross Financial Services Inc. Based in Beverly Hills, California, StockCross is one of the largest privately owned brokerage firms in the nation with branch offices throughout the U.S. Its offerin,gs include traditional broker-assisted trading as well as online services.
tZERO focuses on the development and commercialization of financial technology (fintech) based on cryptographically secured, decentralized ledgers — more commonly known as blockchain technologies.
“An important part of tZERO’s strategy is to buy, build or partner in order to aggregate all necessary components to have end-to-end ownership of its trading, clearing and settlement platform,” tZERO said in a release. “The investment in StockCross adds a key partner with the custodial and clearing functionality of a U.S. DTCC (Depository Trust & Clearing Corporation) member firm to tZERO’s trading ecosystem.”
“We view our acquisition of 24 percent of StockCross and our relationship with the Gebbia family as another key step toward achieving our goal of being the first fully regulated security token trading platform,” said Joseph Cammarata, president of tZERO. “This collaboration unlocks enormous potential and provides us with enterprise-level economies of scale for both of our companies.”
Under the terms of the transaction, tZERO will pay $12 million in cash and receive approximately 1.2 million shares of Siebert Financial Corp., the major stockholder of StockCross.
“Our vision is to bring the benefits of blockchain capital markets to the world without imposing large switching costs on participants in the current U.S. national market system,” said Patrick M. Byrne, CEO of tZERO and Overstock.com. “To achieve that, we are inch-by-inch stitching together a blockchain capital market which we intend to integrate into the current U.S. system. This investment in StockCross is a large step in that direction.”
In a separate transaction, tZERO purchased a 1 percent ownership interest in Kennedy Cabot Acquisition LLC, the controlling owner of Siebert. As a result, tZERO will own approximately an additional 200,000 shares of Siebert.