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Stock Exchange of Thailand Seeks Approval for Security Token Trading

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Stock Exchange of Thailand Seeks Approval for Security Token Trading

The Stock Exchange of Thailand (SET) plans to obtain a “Digital Assets Operating License” from Thailand’s Finance Ministry in preparation for its launch of a security token exchange, as reported by the Bangkok Post. To obtain the operating license, SET must demonstrate that it can implement sound front and back office systems and secure token wallets.

Thailand has joined the race with Malta and Singapore to become the leading hub for security token trading over the next few years. Most security token industry observers peg Malta as leading the pack at present, with its regulated security token exchange already being sandboxed by the Malta Stock Exchange. Even so, SET aims to catch up and win the race to be the first stock exchange in the world to launch a regulated security token trading platform.

Pattera Dilokrungthirapop, chairwoman of Thailand’s Association of Securities Companies and vice-chairwoman of SET’s board of governors, told the Bangkok Post, “Securities companies that are members of the SET plan to apply to become brokers and dealers for digital asset trade on the new exchange. The SET is expected to have an upper hand compared with licensed digital asset exchanges in terms of having large capital and trust”.

SET and its members hosted an investment seminar over the first weekend in February showcasing the outlook for security tokens as a developing industry and the value that the new exchange may add to it.

The security token exchange license would be the second digital asset operating license for SET. Coindesk reported in May 2018 that SET had launched a crowdfunding marketplace, “LiVE,” built on blockchain technology for peer-to-peer trading to help startups access new capital.

With an eye to catching the growing investment trend in digital assets, Thailand issued a royal decree last May that enabled businesses to register as a broker-trader for digital assets. The Finance Ministry is charged with granting crypto operating licenses, while Thailand’s Securities and Exchange Commission is tasked with regulating initial coin offerings, token exchanges, and token brokers under the Emergency Decree on Digital Asset Businesses once a license is issued.

The Stock Exchange of Thailand’s move to set up a crypto exchange is part of its three-year strategic plan (2019-2021) for “Creating Partnership Platform to Drive Inclusive Growth” to “slim down costs and broaden business opportunities for the entire capital market industry, aiming to boost efficiency and become Thailand’s one-stop capital market platform.”

In January, Cointelegraph reported that Thailand’s finance ministry had granted digital asset business licenses to four firms: Bitcoin Exchange, Bitkub Online, Coins TH Co., and Satang Pro. Cash2coin and Southeast Asia Digital Exchange (SEADEX) were denied a license on account of insufficient KYC processes and inadequate IT infrastructure. A third application from Coin Asset is still under consideration.

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Jay Derenthal is a leading cryptocurrency and blockchain writer. He has extensive business development and growth hacking experience, with a particular interest in the tokenization of assets into tradable securities. Jay uses market research to align his reporting with the most exciting trends in the fast-evolving security token news arena.

Exchanges

SIX Acquires Stake in daura – SDX Exchange

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SIX Acquires Share in Duara

In preparation for the launch of the highly-anticipated SDX exchange, SIX announced the successful acquisition of a stake in the duara platform. Daura is a token issuance and registry platform which has seen considerable success over the last year. Now, SIX and its team of collaborators seek to utilize duara’s proprietary software to further the SDX exchange’s capabilities.

A Strategic Advantage – SDX Exchange

As part of SIX’s SDX strategy, the firm partnered with Swisscom, Sygnum Bank, Custodigit and daura. The company intends to utilize the best protocols from each platform in the creation of the SDX exchange. Together, SIX’s team seeks to create a complete security token ecosystem. Here investors and businesses can plan, issue, trade, and manage their security tokens from one easy to understand interface.

Discussing the groups’ strategy, Johannes Höhener, daura chairman and Head of fintech at Swisscom spoke on the importance of the joint development work. Höhener pointed out the team’s other tasks. These tasks include helping to create a new standardizing for the tokenization of Swiss assets. She also touched on the company’s plans to expand into operating private blockchains as part of the overall strategy.

SDX Exchange Partnerships via Press Release

Additionally, Peter Schnürer, CEO of daura took a moment to speak on the benefits and security gained from both investors and companies. He explained some of these benefits including the increased transaction speeds. Typically, traditional securities can take days to settle. The SDX system will allow real-time trading and settlement. Impressively, the platform will be able to tokenize assets in just hours.

Players in the SDX Exchange Project

SIX managed to put together an experienced team of blockchain firms to bring the SDX exchange to life. For example, Sygnum Bank continues to make headlines regarding its September launch date as the world’s first digital asset bank. Also, Deutsche Bourse saw heavy publicity this year after it completed a successful proof of concept of its securities trading ledger. These tests proved many of the advantages obtained when settling securities transactions using distributed ledger technology. Notably, the technology can also tokenize and exchange equity and cash tokens

Daura – SDX Exchange

Duara is an advanced digital share register. The firm also specializes in the issuance of security tokens. In the duara ecosystem, one Tokenized share equates to one newly created share. The reduced costs and added speed simplifies the entire share issuance process. Duara enable enables SMEs to sell stakes in their businesses while reducing the costs of crowdfunding campaigns significantly.

SIX Makes Moves

SIX appears to be ready to take the next steps towards the development of the SDX exchange. The firm’s acquisition of duara shares proves that the company is ready and willing to take all the necessary actions to ensure the success of SDX. Consequently, you can expect to see a lot of hype surrounding the launch of this highly-anticipated platform in the coming months.

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Boerse Stuttgart Subsidiaries to Benefit from Investment by SBI Holdings

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Boerse Stuttgart Subsidiaries to Benefit from Investment by SBI Holdings

SBI Investment

It is fair to say that SBI Holdings has decided to go all-in on blockchain based endeavours as of late.  This has been made evident through various high profile investments.  The most recent of which include Ripple, Securitize, and now Boerse Stuttgart – the latter of which we will discuss here today.

In an effort to usher in higher levels of adoption surrounding digital securities, SBI Holdings has invested in multiple branches of the Boerse Stuttgart group.

  • Boerse Suttgart Digital Exchange
  • Boerse Stuttgart Digital Ventures

Plans Moving Forward

In their announcement, it is clear that the rationality behind this new partnership is geared around global expansion.  With SBI Holdings operating within Japan, and the various branches of the Boerse Group operation throughout Europe, the pair should find the partnership mutually beneficial.

Beyond simple expansion, the pair of companies closed out their announcement by elaborating on their plans.  They stated,

“The SBI Group and the Boerse Stuttgart Group are partners in the digital asset business in Asia, including Japan, as well as in Europe. We will work together to build a global digital asset finance ecosystem utilizing blockchain.”

Commentary

Upon announcing these investments, representatives from each, SBI Holdings and Boerse Stuttgart, took the time to comment.  The following is what each had to say on the matter.

Yoshitaka Kitao, CEO of SBI Holdings, states,

“Due to the decentralized nature of digital assets, it is our top priority to find globally suitable partners to build our digital asset ecosystem. The SBI Group, with its trading platform for digital assets and other relevant companies, will make full use of the cooperation with the Börse Stuttgart Group to respond to the global customer interest in digital assets.”

Alexander Höptner, Chairman of the Management Board of Boerse Stuttgart GmbH, states,

“Asia and Europe are currently the fastest growing markets for digital assets. With the SBI Group, we have found an ideal partner to realize our vision of an efficient, global ecosystem along the value chain of digital assets. In addition to the exchange of knowledge and technology, the collaboration also covers the issuance, listing and trading of digital assets across borders, as well as brokerage services and building the first global bridge for custody.”

Boerse Stuttgart

The Boerse Stuttgart Group consists of various branches such as Boerse Stuttgart Digital Exchange, and Boerse Stuttgart Digital Ventures.  These two branches, in particular, have a focus on blockchain based endeavours, including the eventual creation of a secondary marketplace for digital securities.

SBI Holdings

An acting subsidiary of SBI Group, SBI Holdings, was launched in 1999.  The company maintains headquarters within Tokyo, Japan, where they seek out, and establish, strategic partnerships with high potential companies.

CEO, Yoshitaka Kitao, currently oversees company operations.

In Other News

In recent months, each of the companies discussed here today have found themselves in our news feed.  Whether launching a digital exchange, or making strategic investments, both companies have been quite active.  The following articles are just a couple discussing recent moves by both.

Boerse Stuttgart Launches Digital Exchange

Securitize to Expand within Japan after Recent Investment

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DX.Exchange Goes Bankrupt – CX Technologies Ltd

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DX.Exchange Goes Bankrupt - CX Technologies Ltd
The Estonia-registered crypto exchange, DX.Exchange announced that the company had begun bankruptcy proceedings. The news was somewhat expected after the company closed its doors just a few weeks earlier due to a petition filed against the firm by employees awaiting payroll. Company officials say they have no money left in their bank accounts. Now, a slew of workers and business affiliates await court proceedings.

Bankruptcy Petition

The official bankruptcy petition filed on Oct. 24 alleged that the DX.Exchange owed 78 former employees payroll for the months of September and October. These employees included a variety of workers from CX Technologies Ltd., the company behind DX.Exchange. The petition sought to have the exchange dissolved by an Israeli court.

Unpaid Suppliers

Additionally, a host of suppliers have taken suit against the company. These suits run the gambit from unpaid bills to the alleged fraud. The well-known cybersecurity firm, White Hat Ltd is one of the company’s claiming losses due to DX.Exchange actions. Another lawsuit lists Bee2See Dotan B.S. Solutions. This is the firm that handled DX.Exchange targeted marketing. Even the company supplying the servers never got paid – Malam Team.

Writing on the Wall – DX.Exchange

Employees and suppliers knew to take action earlier in the month after the firm closed its doors unexpectedly. At the time, DX.Exchange owner Pinhas Patarkazishvili cited the rising costs and dwindled profits the exchange had left. He told employees that he was searching for a merger or acquisition and if that he was unsuccessful, the company would permanently cease operations.

DX.Exchange

The much-hyped DX.Exchange promised to deliver an efficient trading experience on the blockchain. The company planned to trade all types of cryptocurrency including security tokens. According to the company’s documents, the exchange had agreements to list some big-name tokenized securities such as Tesla and Apple stock.
DX.Exchange
DX.Exchange

Security Tokens on the DX.Exchange

When questioned about the security token aspect of the exchange specifically in a recent interview, DX. Exchange CEO, Daniel Skowronski explained that the company applied for an MTF (multilateral trading facility) exchange license under a different entity but never completed the requirements prior to filing for bankruptcy.

Shady Dealings

Interestingly, this story goes much deeper. Apparently, it was reported that Limor Patarkazishvili (DX.Exchange owner’s wife) was the sole owner of another firm that was raided by the FBI in 2018. The company, SpotOption, allegedly was a major player in a large international binary options scam. When investigators delved deeper, they discovered that both companies shared staff.
At first, the DX.Exchange denied any involvement in SpotOption. Eventually, it came to light that Limor Patarkazishvili was the main shareholder in the firm. She owed 99 percent of the shares. This discovery only fueled speculation that the couple wanted to skip out on their past-due payments.

Will Employees and Affiliates Get Paid?

Skowronski publicly claimed that his company is not in “an exit scam.” Unfortunately, this was right before the company closed its doors. For now, the holidays could be bumpy for employees of the DX.Exchange as they attempt to cope with the financial losses.
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