The ecosystem is to provide issuance, custody, access to liquidity and banking services leveraging distributed ledger technology.
Deutsche Börse Group, one of the largest market infrastructure providers, Swisscom, Switzerland’s dominant network operator, and Sygnum, a Swiss and Singapore-based financial technology company say they have entered into a strategic partnership.
The aim of is to jointly build and expand a trusted financial market infrastructure for digital assets that meets all regulatory requirements. The ecosystem, based on distributed ledger tech, which originated with the cryptocurrency Bitcoin, was developed and will be operated by Swisscom.
Assuming they win merger control clearance, the partners plan to offer the first products and services during 2019.
Next major phase
In a joint statement the three claim, “tokenisation of assets [will be the] next major phase of asset digitization [and] has the potential to reshape global financial markets. In order to fully unfold its potential, the emerging tokenised economy needs a trusted, comprehensive and regulatory compliant ecosystem.
The core elements of the solution will include issuance, custody, access to liquidity, and banking services. The plan is these foundational elements of the digital asset ecosystem will expand in keeping with the needs of participants in the market.
It’s complicated
The arrangements within the deal are somewhat complicated. Deutsche Börse will invest in Custodigit, founded as a joint venture by Swisscom and Sygnum in 2018, as part of the deal.
Custodigit’s technology provides custody of digital assets for regulated financial services institutions. Its integrated platform allows bank customers to manage the entire life cycle of their digital assets.
As one of the main shareholders, Deutsche Börse will support Custodigit business and the evolution of its technology.
Also, Deutsche Börse and Sygnum will become shareholders of daura, which developed a distributed ledger-based platform to issue, transfer and register shares of small-and medium-sized Swiss enterprises, meaning that unlisted companies can access capital markets. As shareholders of daura, Deutsche Börse and Sygnum will involve themselves in the companies’ development.
That’s not all
Deutsche Börse and Sygnum are working on another building block for the ecosystem in the shape of a listing and trading venue for digital assets in the Swiss market.
Access to liquidity via an open, regulation-compliant marketplace is considered a critical element for building a scalable digital assets ecosystem.
Sygnum has been awarded a Swiss banking and securities dealer licence by the Swiss regulator FINMA, provide banking services such as custody, deposits, credit & lending, capital issuance via tokenisation, brokerage and asset management within the digital asset ecosystem.