Prometheum, HashKey and Velocity Capital Plan Offshore Distribution of DTC-Tokenised US Stocks
Key points
- Prometheum, HashKey, and Velocity Capital announced plans to distribute DTC-tokenised US equities to international investors through HashKey's licensed exchanges.
- The DTC's tokenisation service is scheduled to launch in October, making this one of the earliest announced international distribution arrangements for its tokens.
- HashKey holds a Hong Kong crypto exchange licence and has a market capitalisation of US$820 million; Velocity Capital's parent is 75% owned by South Korea's Hanwha Life.
- HashKey acquired roughly 25% of Prometheum in 2018, and neither company has disclosed whether that stake is still held, despite prior congressional scrutiny of the relationship.
- Unlike most offshore tokenised equity structures, which give holders a claim on the token issuer rather than the company, the DTC model offers a structurally cleaner form of ownership.
Prometheum, HashKey, and Velocity Capital have announced a partnership to distribute tokenised US equities to international investors via HashKey’s licensed exchanges. The tokens in question will be minted by the Depository Trust Company (DTC), the US central securities depository, whose tokenisation service is scheduled to launch in October. Both Prometheum and Velocity Capital are registered US broker-dealers.
HashKey, listed in Hong Kong with a market capitalisation of US$820 million, was among the first two firms licensed to operate a crypto exchange in the city and also runs an exchange from Bermuda while holding a Dubai licence. Velocity Capital’s parent is 75% owned by South Korea’s Hanwha Life. What makes this arrangement structurally notable is that most tokenised stocks currently circulating offshore are debt instruments backed one-for-one by underlying shares, giving holders a claim on the token issuer rather than a direct stake. Coinbase‘s model differs by representing a beneficial interest held via a special purpose vehicle. The DTC route, as the source characterises it, is cleaner than either of those approaches.
Prometheum carries significant political and reputational baggage into this arrangement. Under former Securities and Exchange Commission (SEC) chair Gary Gensler, its subsidiary became the first special purpose broker-dealer approved to custody digital asset securities, a positioning that drew fierce hostility from the crypto industry for buttressing the view that most tokens are securities. Congressional scrutiny has also focused on Prometheum’s ties to Wanxiang and HashKey: Senator Tommy Tuberville called for action, describing HashKey as a Wanxiang affiliate with what he characterised as deep ties to the Chinese Communist Party. HashKey purchased roughly a quarter of Prometheum in 2018, and HashKey chairman Xiao Feng appeared as a Prometheum director in a January 2023 regulatory filing but not in subsequent ones. Neither firm has disclosed whether that ownership stake remains, a gap the current announcement leaves unaddressed.