SIX Group, the operator of Swiss Stock Exchange has announced that it will launch a new blockchain-powered exchange, dubbed SIX Digital Exchange (SDX), in the second half of 2019.
The new digital platform will run in parallel to existing SIX platforms. The existing platform witnesses roughly volume of 5.19 billion Swiss Francs (CHF) or $5.18 billion in daily terms and has a market capitalization of over 1.67 trillion CHF or $1.6 trillion. The new platform will use blockchain distributed ledger to bridge traditional finance and the technology of cryptocurrencies.
According to its CEO Jos Dijsselhof, the exchange has selected the technology for the time efficiency and improved security it offers across all stages of stock trading and settlement.
“The fact is, it takes two days for the buyer of stock to become the owner. The trade itself only takes a fraction of a second, but after that payments have to be settled and titles transferred. If we put it all on our digital exchange, then the whole process takes only a few seconds. This makes the market more efficient, but at the same time also takes risks out of the system.”
As per the SIX Group’s Chairman Romeo Lacher, the company is ready to add a number of digital assets to its platform and believes that the existing system would be replaced completely by the new digital system in the next ten years. The exchange has not clarified the stocks or products to be listed first, but it is likely that it will introduce only selected stocks initially.
Following the full launch of digital exchange, other products such as bonds and exchange-traded funds will also be listed and as well as tokenizing other assets will also be done. Lacher said:
“We want to start with our own Security Token Offering. The supervisory board will probably decide (on the project)in late summer,”
With this, SIX Group has become the first leading marketplace to use the technology to offer such a regulated environment for digital assets. Other exchanges such as the German stock exchange operator Deutsche Boerse has also set up a unit to explore the technology for various use cases.