Bx Swiss: Test trade in Swiss francs via a decentralized public blockchain.
Together with major Swiss banks, the Swiss exchange BX Swiss takes the financial market infrastructure for tokenized securities to the next level. In a test, trades on BX Swiss were for the first time settled directly in Swiss francs via a decentralized public blockchain.
The test was carried out as part of a proof of concept under the auspices of the Capital Markets Technology Association (CMTA). In the process, structured products were issued by the Swiss banks Credit Suisse, Pictet and Vontobel in tokenized form as ledger-based securities on the Ethereum test blockchain and then traded via the BX Swiss trading platform.
In a further step, trades were settled directly on the blockchain via a globally unique mechanism. For this, CMTA created an additional open source smart contract for bilateral and secure settlement without counterparty risk. Cash-side settlements in Swiss francs were performed for the first time via a direct technical bridge connecting the Ethereum blockchain with the Swiss Interbank Clearing (SIC), the payment system of the Swiss National Bank.
With the proof of concept, BX Swiss was already able to test the technical basis for the settlement of trades in tokenized securities against Swiss francs with different banks. The tested settlement system on a decentralized and public blockchain infrastructure provides cost advantages along the entire value chain of securities (issuance, trade settlement and custody) and enables the exploitation of the potential of the already rapidly growing global market for blockchain-based securities.
In order to productively trade tokenized securities in the near future, BX Swiss still requires a separate and additional financial market license from the Swiss financial market supervisory authority FINMA.
Lucas Bruggeman, CEO of BX Swiss AG
“Our long-term goal is to revolutionize securities trading so that more and more retail investors can participate in the capital markets and SMEs have easier access to regulated trading,”
emphasizes Lucas Bruggeman, CEO of BX Swiss.
“The proof of concept of CMTA is a milestone in cost-effective settlement of trades in tokenized securities.”
Matthias Müller
“The Swiss legislature has created the necessary regulatory framework for the use of blockchain technology in the capital market. The settlement system tested with the banks can deliver on the promise of this new technology, so that trades can be settled in a decentralized and much more cost-effective way in the future.
commented Matthias Müller, Head of Markets and Services at BX Swiss.
“We don’t need a new digital central bank currency (CBDC) or a stablecoin for this. This is a crucial step to adopt blockchain technology in the existing financial system.”
Börse Stuttgart Group, to which BX Swiss belongs, is the regulated infrastructure partner for secure access to cryptocurrencies and tokens.
Featured Image Credit: Edited from Unsplash
