North Capital Investment Technology, Inc., a financial technology company specializing in private securities solutions, announced that its subsidiary, North Capital Trust Company, has received a Public Trust Company charter from the South Dakota Division of Banking. This charter allows the trust company to operate as a qualified custodian for digital and tangible assets, including tokenized securities, addressing a critical need in the evolving digital asset landscape.
The charter comes after years of regulatory challenges. In 2019, the SEC and FINRA issued a Joint Staff Statement on Broker-Dealer Custody of Digital Asset Securities, which effectively prevented clearing and carrying broker-dealers from acting as custodians for digital asset securities. This was a setback for North Capital, whose broker-dealer, North Capital Private Securities Corporation, had received clearing and carrying approval in 2016. Although the Joint Statement was withdrawn last year, the company believes the trust company charter offers greater flexibility. “We began to explore the feasibility of forming a trust company about six years ago,” said James P. Dowd, CEO of North Capital.
The trust company model is increasingly favored for custody of digital assets. North Capital has already expanded into this space with the launch of North Capital Token Services, LLC earlier this year. Grant Nelson, Managing Director and Head of Custody and Brokerage, stated, “We are excited to receive our Public Trust Company charter, which positions us to better serve our custody clients and expand our scope of services beyond private securities.” The company expects to commence trust operations in the coming months.
Qualified custodians are essential for registered investment advisors, registered funds, and retirement accounts such as IRAs, Roth IRAs, HSAs, and 401(k) plans to meet statutory custody requirements. By offering trust services, North Capital aims to meet the evolving needs of its customers in a rapidly changing market environment. For more information, visit https://www.northcapital.com.
