Global Stock Exchange Group (GSX), a fintech company based in Gibraltar that deploys blockchain solutions to drive interoperability between cryptocurrency and traditional markets, launched its Estonia-based Grid tokenized securities platform.
The Grid facilitates the tokenization of securities and funds for new and existing debt. GSX is also planning to launch equities during its second roll-out phase. The platform also enables customized smart contracts to underpin every digital security.
Nick Cowan, Chief Executive of GSX Group, described the Grid as “the first step in a phased development approach that began in 2018,” consisting of “a venue for the creation and deployment of tokenized digital securities, dubbed ‘Smart Securities.’
GSX operates the Gibraltar, London, Singapore and Hong Kong offices and trading venues. The firm envisages expanding its tokenized securities ecosystem with end-to-end exchanges to offer “pan-jurisdictional interoperability.”
“This is a key benefit of the GSX Group smart securities system,” said Cowan. “It is part of a capital markets vision, where post-issuance on the GRID, tokenized digital securities are able to be admitted for trading on one of GSX’s tokenized securities trading venues — subject to relevant regulatory permissions and qualifying conditions.”
EU-based products created using Grid may apply for listing at GSX’s Gibraltar-based trading location.
Cowan believes the material benefits to the capital markets offered by tokenized securities and blockchain technology will drive institutional adoption over the next five years.
“As with any disruptive technology, adoption is the largest barrier to overcome, but it is our view that the benefits for the capital markets sector are so material that all participants in the capital markets sector, issuers, institutions, investors, broker dealers, and member firms alike, will start to look more closely.”
Gowan anticipates that the security tokens offer the legacy securities sector approximately $300 billion in annual cost and efficiency savings. This is in addition to “the capital that will be released back to the market participants in a pre-funded environment.”
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