Bruce Fenton launches SEC-registered broker dealer for crypto firms

Bruce Fenton, CEO of Chainstone Labs and bitcoin evangelist, has launched a new decentralized broker-dealer focused on the intersection of digital and traditional assets.

Called Watchdog Capital, the firm is registered with the U.S. Securities and Exchange Commission (SEC) and a member of the Financial Industry Regulatory Authority (FINRA). It will operate as a subsidiary of Chainstone Labs.

According to a press release, the New Hampshire-headquartered firm is approved for securities underwriting, investment banking, crowdfunding, Reg A+ offerings, REITs and various OTC, retail and institutional business such as directed brokerage. It clarified that it does not plan to custody digital assets.

Watchdog Capital said that it intends to build a platform that is both regulatory compliant while also embracing new technology. It aims to help companies and individuals maintain registration and licenses to offer the latest investment products while ensuring regulatory compliance.

“We are an institutional grade investment advisory offering highly customized boutique services with a focus on traditional assets, digital securities, and other distributed ledger technologies,” according to the official website.

According to CoinDesk, Watchdog aims to provide back office, technology and compliance support to crypto and blockchain companies as well as financial advisory services to individual representatives.

"Watchdog is particularly interested in the future of technologies like decentralized exchanges, cross chain atomic swaps, the Lighting network and privacy tools for digital assets. This is an ever-evolving area and the team believes we can merge the best of decentralized technology and its core values in a regulated environment," said Fenton.

Watchdog said that its decentralized platform allows firms and individuals who meet a strict due diligence process to affiliate with the firm and access its technical and operational capabilities. Currently, the firm's services are only open to select high net worth investors and through partnerships and affiliations, the release said.

Carl Litsch, Director and Chief Compliance Officer of Watchdog, said that the firm is working to support SEC-compliant, regulated securities projects built on Ethereum and other platforms, in addition to bitcoin.

“As the industry and regulatory environment matures, the firm plans to expand offerings. Any purchases, sales and offerings will go through a rigorous compliance approval process. The firm is open platform and will focus on SEC registered and regulated offerings,” the release added.

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