tZERO Group, Inc., a blockchain-powered multi-asset infrastructure innovator, announced that its broker-dealer subsidiary's alternative trading system can now facilitate trading of crypto asset securities directly custodied on-chain by customers in their own self-hosted wallets. This development enables transactions in those securities to be settled directly by customers on-chain, marking a significant advancement in the convergence between traditional finance and decentralized finance ecosystems.
The capability represents a critical step in tZERO's convergence strategy, providing an additional bridge between traditional finance and the broader decentralized finance ecosystem for customers and API partners. By supporting integrated self-hosted wallets, tZERO allows customers to interact with its regulated alternative trading system without relinquishing control of their private keys or assets to intermediary custody services. As one of only two broker-dealers currently custodying securities directly on-chain in its own wallets, tZERO will continue offering omnibus or individual wallet custody alongside self-hosted wallet connectivity for investors preferring broker-dealer custody for operational, regulatory, or other reasons.
Alan Konevsky, CEO of tZERO, stated that the company is becoming connective tissue for market participants across all vectors of Web3. The self-hosted wallet capability provides market-demanded optionality while pointing toward compliant and transparent marketplaces that rely on self-regulating technology and asset sovereignty to deliver cross-asset, cross-border, and cross-protocol, AI-enabled investing experiences. These services will be available to institutional API partners who choose tZERO's infrastructure rather than building their own systems, even in more permissive regulatory climates. tZERO is opening new pathways to DeFi connectivity and interoperability for the marketplace, as detailed on their website.
Custodial optionality forms a central pillar of this feature, with tZERO's brokerage platform now supporting a hybrid approach that recognizes varying preferences among market participants. Customers can choose between directly custodying their own assets on-chain using self-hosted wallets or utilizing broker-dealer custody, enabling seamless movement between traditional finance and decentralized ecosystems. Vanessa Savino, Chief Legal Officer of tZERO, emphasized that regulatory clearance for interoperability with user self-hosted wallets promotes crypto asset programmability, portability, and transparency within the brokerage ecosystem while demonstrating responsible innovation advancement through regulatory collaboration.
tZERO plans to integrate key management and wallet infrastructure providers in the first half of 2026 to support secure, compliant settlement workflows involving self-hosted wallets. This development represents a significant shift toward asset sovereignty in regulated financial markets, potentially reducing counterparty risks associated with third-party custodians while maintaining regulatory compliance. The move could accelerate institutional adoption of blockchain-based securities by addressing custody concerns that have traditionally hindered participation from regulated entities. By bridging traditional brokerage services with decentralized finance principles, tZERO's platform may establish new standards for how regulated markets interact with blockchain-native assets, creating more efficient settlement processes while preserving investor control over digital assets.
