Tokenization of securities often replicates traditional structures by issuing blockchain tokens that merely track the value of underlying shares, without granting holders direct shareholder rights. T7X Equities proposes a different model called “native issuance,” in which the token is created as part of the authorized security issuance from the outset.
Legal Framework
Wyoming, Delaware and Nevada corporate law recognize a “certificate token,” allowing corporate shares to be represented electronically on a blockchain. T7X, incorporated in Wyoming, structures its offerings to comply with this framework, keeping the official master securityholder file with a registered transfer agent while using the blockchain to record transactions.
Operational Model
Under native issuance, the token, the security, and the ownership record are unified: the issuer authorizes the token, investor verification is built into the process, and a transfer agent validates each transfer. T7X Equities serves as the transfer agent for its offerings, holding SEC registration and maintaining the authoritative ownership ledger.
The company’s first offering, Tranquil Healthcare Fund I, is a Tier 2 Regulation A+ raise of up to $75 million that the SEC qualified on June 29. Tokens representing the fund’s shares were issued on the Trusted Smart Chain and delivered to investors’ wallets.
Compliance and Oversight
T7X’s approach, described by its chief executive Pablo Penaloza as involving a “registered, SEC‑regulated gatekeeper,” aims to ensure that tokens carry the same legal rights as traditional shares, including voting and dividend entitlements. The model aligns with the SEC’s innovation exemption, which permits tokenized stocks that convey shareholder rights while excluding purely price‑tracking synthetics.
Target Market
The platform focuses on companies raising between $50 million and $75 million through Regulation A+ offerings. This regime allows public solicitation, participation by non‑accredited investors, and requires audited financial statements and ongoing disclosure, differentiating it from Regulation D placements that are limited to accredited investors.
Penaloza notes that a native digital security can trade on secondary markets without a custodian, potentially improving liquidity for investors holding Regulation A or D securities, which traditionally receive paper certificates and limited resale options.
Outlook
T7X positions its native issuance model as a way to streamline capital formation and enhance market liquidity, arguing that integrating compliance, ownership verification, and settlement into a single digital representation could accelerate the growth of tokenized assets.
