Announced April 9th 2019, the Gibraltar Stock Exchange (GSX) is now using blockchain technology to list a variety of tokenized assets on GSX Global Market (GSX GM). According to GSX, they are the first regulatory compliant exchange to use the blockchain to list assets of this type.
The Tokenized Securities Listed on Gibraltar Stock Exchange – Explained
GSX will now be listing numerous classes of real-world assets in the form of security tokens. These include corporate bonds, convertible bonds, asset-backed securities, derivative securities, and closed-ended funds.
Also announced was the opening of membership access to firms based outside of the European Union (EU) and European Economic Area (EEA). Now, GSX has invited licensed financial services firms from several jurisdictions to join GSX.
There are two markets operated by GSX— the GSX Main Market and the GSX Global Market. In terms of EU regulatory compliance, the GSX Main Market is the Gibraltar Stock Exchange’s regulated market, as defined by the Markets in Financial Instruments Directive (MiFID).
According to GSX CEO Nick Cowan, the listing of tokenized assets is likely to increase the levels of liquidity traditionally seen in similar asset classes:
“Offering the listing of digital debt and digital fund securities significantly widens the potential GSX user base in respect of both Members and Issuers.”
In addition, Cowan said GSX aims to develop into a one-stop-shop for security token issuers and traders:
“GSX Group companies can offer smart contract programming and provide enterprise wallet custody solutions. The GSX Group also boasts an experienced fund administrator in digital assets offering incorporation and corporate solution services to issuers. The use of DLT in the listing process represents a route to market for issuers seeking to gain access to the benefits of tokenised debt and fund opportunities, within the framework of a regulated stock exchange.”
Gibraltar Stock Exchange’s Growing Interest in the Security Token Industry
In December of 2018, GSX announced that it would now offer insurance for the digital assets kept in its custody.
Earlier this month, GSX announced a partnership with STO Global-X to provide a “turnkey exchange-in-a-box” solution for tokenized securities.
Enterprises in the traditional financial securities sector are slowly implementing the benefits of Distributed Ledger Technology (DLT).
Real-world assets to include equity, real estate, investment funds, REITs, and fine art have all become tokenized.
Security Token Offerings (STOs) saw a 130% increase in Q1 2019 when compared to Q4 2018.
With an increasing number of exchanges integrating tokenized securities, many anticipate a significantly further expansion of the security token marketplace.
For more on the overall benefits of security tokens, be sure to review our comprehensive security token guide.
What do you think of GSX listing tokenized securities? How long it will it require for this to become a common trend among other financial trading platforms? We want to know what you think in the comments section below.
Image courtesy of GSX.