Japanese Firm invests Millions in Digital Securities Platform
The Singapore Exchange is planning to launch a platform that will allow the trade of blockchain-based digital securities. A major financial giant in Japan has taken an interest in the platform and invested about $5.58 million in the platform. According to media reports, Tokai Tokyo Financial Holding will invest about 500 million yen in the platform and get a 4.8% stake in the firm. The platform has been named iSTOX market and will be launched by the Singapore Exchange soon.
Tokai Tokyo is the only Japanese firm that has invested in ICHX Tech, the other firm that has a major stake in the platform is Temasek Holding, Singapore’s state fund, which owns a 10.8% stake in the platform.
The distributed ledger powers digitized securities, which is the same technology that power cryptocurrencies such as Bitcoin. They offer the benefit of allowing quicker settlements and customizable issuances compared to traditional bonds and stocks. The use of digitized securities is expected to grow a great deal in the next few years.
Real assets, unlike cryptocurrencies that are issued during ICOs, back these securities. Various countries have already given them official recognition. Japan is expected to approve the use of digital securities in April 2020. Tokai might use the experience it gains from this venture to set up a similar platform in Japan.
iSTOX is on course to receive from Singapore financial regulator in February 2020. This will make it the first exchange of its kind in Asia. The first sector that is likely to start trading digital securities on the exchange in the real estate industry. Based on the experience it gains, it could expand to other industries such as corporate debt and intellectual property.
Tokai Tokyo plans to use the platform to help firms in Japan to raise funds on the platform by offering digital securities. Besides that, the company plans to brokers the securities listed on the platform to investors in Japan. iSTOX intends to expand the platform to other nations in the future. This could make it possible to trade digital securities globally via the Singapore Exchange.