The Canadian Securities Exchange (CSE) plans to launch a blockchain-based clearing and settlement platform for token sales, it announced today.
The initiative will see the CSE move to list so-called "Security Token Offerings," through which blockchain-based assets which are explicitly securities would be offered and sold. The blockchain-powered platform represents a new service area for the exchange, which has been operating since 2003.
Companies will be able to use the platform to issue traditional equity and debt through tokenized securities, which would then be offered to investors through fully regulated offerings, which stand in contrast to initial coin offerings (ICOs) that more often than not operate in a regulatory gray area.
"Our platform represents an intersection between blockchain and the capital markets that delivers on blockchain's promise to disrupt conventional transaction and record-keeping mechanisms, thereby providing tangible benefits for market stakeholders," Richard Carleton, chief executive officer of the CSE, said in a statement.
"By harnessing this technology, the potential exists to extend corporate finance beyond the limits of traditional equity and debt offerings," Carleton added.
The CSE has licensed the platform's technology from Fundamental Interactions Inc., a New York-based firm that designs "multi-asset trading appliance products."
In the meantime, the exchange operator has also signed a "memorandum of understanding" with Kabuni, a 3-D printing company in British Columbia that plans to file with the British Columbia Securities Commission (BCSC) to issue tokens to investors via a security token offering. If successful, Kabuni will become the first company to list a tokenized security on the existing CSE platform.
Trading image via Shutterstock