Financial technology firm Ironlight Group has raised $21 million in a Series A funding round as it looks to expand infrastructure for issuing and trading tokenized securities in the United States.

The Texas-based company said Monday the round included backing from former TD Bank President and CEO Greg Braca, along with institutional investors including the Sei Development Foundation and Laidlaw Private Equity.

Ironlight is building a marketplace designed to handle issuance, trading and settlement of blockchain-based securities through its broker-dealer subsidiary, Ironlight Markets. The platform operates as an alternative trading system, or ATS, under U.S. securities rules.

The company plans to use the new funding to expand its trading venue and the technology stack behind it, which is designed to support tokenized versions of assets such as "private equity, fixed income, private credit and real estate."

Ironlight’s ATS received approval from the Financial Industry Regulatory Authority last year to support trading in both traditional and tokenized securities. The system is designed to combine a centralized order book with blockchain-based settlement, allowing trades to clear and settle directly onchain.

Braca, who led TD Bank before joining Ironlight, was also recently named the firm’s executive chairman as it looks to expand partnerships with traditional financial institutions.

Tokenized securities' regulatory shift

The funding arrives as regulators in the U.S. continue to clarify how existing securities laws apply to blockchain-based assets.

Last week, Hester Peirce said the Securities and Exchange Commission is working on a limited "innovation exemption" that could allow controlled experimentation with trading certain tokenized securities. Separately, the Federal Reserve recently said banks should treat tokenized securities the same as traditional securities for capital purposes, emphasizing that existing rules are "technology neutral."

Interest in tokenizing traditional financial assets has been steadily growing across crypto and traditional finance.

Data from RWA.xyz estimates the tokenized real-world asset market at roughly $26 billion, led by $11.2 billion in tokenized U.S. Treasury products. Other segments include $5.7 billion in tokenized commodities, about $3.1 billion in asset-backed credit, and smaller allocations across tokenized equities, corporate debt, and other credit instruments.