…the First Fully-Integrated Digital Exchange in Switzerland
SIX is developing Switzerland’s first fully-integrated digital exchange. The company has teamed up with PassOn and Blockstream and is going to launch their service in early 2019. SIX intends that the newly created exchange will enjoy the same standard of oversight and regulation as conventional exchanges.
Switzerland’s stock exchange – owned and managed by SIX – is stepping up its digital game. The company wants to be a frontrunner in digital assets trading and leverage the nation’s reputation as a crypto-friendly marketplace. Therefore, it has announced that it is developing a fully integrated trading platform for digital assets.
The project is called SIX Digital Exchange (SDX) and will be based on distributed ledger technology. SDX will offer mainly three services: trading of tokenized digital assets like cryptocurrencies and others, integrated post-transaction services such as deal settlement, and asset custody.
SDX aspires to provide a bridge between traditional finance and the growing world of digital assets. “For us it is abundantly clear that much of what is going on in the digital space is here to stay and will define the future of our industry. The financial industry now needs to bridge the gap between traditional financial services and digital communities,” said Jos Dijsselhof, SIX’s chief executive.
So far, there is no fully integrated end-to-end trading, settlement and custody service for digital assets in Switzerland. Traders have to use a variety of third-party providers throughout the trading process, making the trading of digital assets less secure, more complicated and more expensive.
SIX teams up with PassOn and Blockstream to develop a fully integrated end-to-end digital exchange
SIX has teamed up with the Swiss-based pre-ICO startup PassOn AG, which is specialized in the transfer of digital assets as part of inheritances. SIX has acquired a minority stake and board seat in the startup.
PassOn is building its own separate blockchain-based platform, allowing users to transfer digital assets to relatives after they have passed away, using rules encoded in a smart contract. Thus, PassOn is essentially creating an infrastructure that is capable of linking tokens to their underlying assets, even after the token had been transferred to another owner. This technology should coincide nicely with SIX’s plans to build a platform for legitimate blockchain-based transfers of digital assets.
“We aim to leverage the latest blockchain and smart contract technologies to bring inheritances into the digital age. We are preparing our ICO to fund the development of our digital estate planning and inheritance platform. In parallel, we will explore how to use SDX offerings such as listing or secure storage of the PassOn token to leverage the SIX digital ecosystem,” says Stephan Wippermann, CEO of PassOn AGv.
Besides the cooperation with PassOn, Six has also signed up to Blockstream’s Bitcoin sidechain “Liquid”. Liquid can speed up large quantities of cryptocurrency transactions and more importantly, it enables users to launch their own tokens on the system. Therefore, Liquid will enable SDX to list and trade tokenized versions of company shares on their exchange.
SIX has not yet commented on the exact services and products it will eventually provide, but the cooperation with Liquid indicates that tokenized company shares will be part of the product range. This would allow SIX to tap into the trend of conventional trading starting to move to blockchain.
SIX intends that its new digital exchange will enjoy the same standard of oversight and regulation as conventional exchanges
A major concern for blockchain companies and crypto traders worldwide is that industry regulation is still in its infancy.
“The digital space currently faces a number of key challenges. These include the absence of regulation that ensures official safety, security, stability, transparency and accountability – all of which contribute to a lack of trust”, says Thomas Zeeb, Head Securities & Exchanges at SIX.
SIX is regulated by the Swiss financial authority Finma as well as the Swiss central bank. SDX will therefore adhere to the highest standards of financial oversight and regulation, according to SIX’s executives. Similar to neighboring Liechtenstein, Swiss politicians are also removing obstacles for the fast-growing blockchain industry, trying to attract more business to the country.
SIX is planning to launch their services in the first half of 2019. Being and early mover, combined with regulatory support in the country, the newly established exchange could become a global leader for digital asset trading.