Tokenization pioneers Securitize and tZERO clash over patents as Wall Street moves onchain

Market forecasts have ballooned in recent years. Citi has estimated tokenized assets could reach a $5 trillion market capitalization by 2030, while a report from Boston Consulting Group and Ripple projected a market worth $18.9 trillion by 2033.

Patent battle over tokenization infrastructure

At the center of the dispute are patents covering compliance systems for tokenized securities, digital asset issuance and redemption technology and blockchain-based trading infrastructure.

tZERO said its investigation concluded that products including Securitize’s DS Protocol and Vault Registrar infringe patents covering self-enforcing compliance controls for security tokens and crypto integration systems.

The company said it is also investigating potential infringement by at least six other firms across tokenization, institutional crypto infrastructure and decentralized finance.

Securitize rejected the claims.

“tZERO’s allegations are without merit and run counter to the spirit of fair play that defines our industry at its best,” the company said in a statement posted on X.

Early pioneers clash amid growing stakes

The dispute pits two pioneers of tokenization against each other.

tZERO launched in 2014 and has spent more than a decade building technology for regulated digital asset markets and says it holds 105 patents globally across 23 patent families related to tokenized capital markets. NYSE parent Intercontinental Exchange made a strategic investment in the company in 2022, and tZERO unveiled plans last year to go public.