Swiss exchange SIX to launch blockchain bourse in second half
Swiss exchange SIX plans to launch its new SDX trading platform using blockchain technology to speed up trading in the second half of this year, Chairman Romeo Lacher said on Wednesday.
The new SIX Digital Exchange (SDX) will initially run parallel to the existing SIX platform, which involves three steps to complete a trade, often over several days. Two of those steps vanish in a blockchain distributed ledger, meaning a transaction can be completed in fractions of a second.
“The supervisory board will probably decide (on the project)in late summer,” Lacher told Reuters on the sidelines of a Swiss Finance Institute conference, adding the group was clarifying legal and regulatory issues with the Finma market watchdog. SIX had earlier signaled a summer start date for the alternative bourse, which it expects to overtake its traditional trading platform within a decade.
Other exchanges are eyeing similar approaches, but SIX sees itself in the lead and intends to show off the technology by raising money itself via the new platform in the second half of the year. “We want to start with our own Security Token Offering,” Lacher said. Like an initial public offering (IPO) of stock or an initial coin offering (ICO), a STO raises capital. But while an ICO places a voucher for future products or services, an STO offers a stake in a company.
SDX is likely to offer trading in selected stocks, followed by other stocks and later bonds and possibly exchange-traded funds, officials have said. Even assets that are not securities — such as paintings or vintage cars — could one day change hands on SDX. Although stock and bond dealing on SIX and most other exchanges is now fully electronic, the underlying processing steps are often based on old protocols of paper and post.