The full security token trading platform planned by Swiss stock exchange, SIX, will no longer go live in 2019 according to an update published by the company this week.
Instead, the company launched a prototype of the planned security token trading platform as well as a blockchain-based central securities depository (CSD) that will exist alongside it.
SIX explained that the objective of the prototype is to showcase the future of financial markets to the community and obtain relevant feedback to enable it to improve the solution.
The prototype will as well “demonstrate that a distributed CSD – based on DLT – can be integrated with a central order-book stock exchange model to ensure fair market conditions for all,” according to the SIX announcement.
Another section detailed how the prototype will facilitate instant settlement, thus removing counterparty risk and the need for default fund collateral at a central counterparty clearinghouse.
“This implies that if the buy and sell-side have the necessary cash and assets to fulfill a trade, the settlement will occur instantly. This structure is helpful for providing liquidity and credibility for the issuance and trading/settlement/custody of new digital assets,” SIX explained in the release.
While users get used to the new prototype, the company also noted it would release future updates with a particular emphasis on asset servicing, while the full platform will launch in Q4 2020.
Meanwhile, although the current delay by SIX to release the security token trading platform may suit the company’s strategy, it comes at a time when their closest competitor, Seychelles-based MERJ Exchange already unveiled a similar platform. MERJ, as we reported, has become the first national exchange offering security token trading.