Switzerland’s stock exchange – owned and managed by SIX, today announced that it is building a fully integrated trading, settlement and custody infrastructure for digital assets.
Plans for the ‘digital asset ecosystem’ – SIX Digital Exchange (SDX) – will see its first services rolled out in mid-2019.
SIX is regulated as an operator of Financial Market Infrastructure (FMI) by Swiss Authorities, FINMA and the Swiss National Bank. The service will be mainly based on Distributed Ledger Technology (DLT).
The implementation approach will provide a bridge for clients from the traditional to the new world, in a timeframe which allows clients to choose for themselves how and when to avail themselves of the new opportunities the new ecosystem provides.
The company is owned by its users (127 banks). With a workforce of some 4,000 employees and a presence in 23 countries, it generated operating income in excess of CHF 1.9 billion and group net profit of CHF 207.2 million in 2017.
“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. The challenge is less in the trading of assets but rather in the custody and asset servicing, including asset safety. Do you adopt a model with many sub-custodians, including inefficient interfaces and with inherent risks, or do you go with a recognized and regulated infrastructure provider who provides all steps of the chain in an integrated and secure model? We believe that the latter has significant value. As the stock exchange infrastructure for Switzerland, we know what it takes to build and run mission-critical and scalable, systemically important services.”
“This is the beginning of a new era for capital markets infrastructures. 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. This is the role that we at SIX can play. SIX is in a unique position in that it runs the entire securities and payments value chain for Switzerland already, and is ideally positioned to create the digital ecosystem for the future, allowing existing and new market participants to develop their business models for the opportunities available in this new environment. These are strengths that we can bring to the digital space and contribute meaningfully to what is one of the most innovative and dynamic environments of our time.”
Shane Brett, Co-founder, and CEO of GECKO Governance, the provider of ICO compliance solution GECKO Crypto1, said:
“This step displays the growing level of confidence which entities such as the Swiss stock exchange and FINMA are placing in the growing blockchain sector, and the increasing understanding of how regulation, transparency, and trust influence perception and uptake of the technology. Switzerland has shown itself to be a hub for blockchain companies, and this announcement further bolsters that reputation. The launch of a fully regulated crypto exchange further highlights Switzerland’s forward-thinking approach to digital assets and cryptocurrencies. Such dynamism and willingness by institutional actors to engage with this emerging economy will hugely benefit the global blockchain ecosystem, particularly once other nations take similar actions.”