LONDON, Nov 18 (Reuters) - SIX Swiss Exchange's new digital
trading and settlement arm will issue a bond to show how
blockchain can benefit mainstream securities and not just the
cryptoassets it was originally intended for, the exchange said
The Swiss Digital Exchange (SDX) will be the first fully
regulated market infrastructure to issue a digital bond and use
distributed ledger technology (DLT) for settlement, said SDX CEO
The bond in SIX Group AG would have a total volume of 150
million Swiss francs and mature in 2026, with the offering
oversubscribed several times, SIX said.
Two-thirds of the bond will be tokenised on SDX, the rest on
SIX's main exchange, with net proceeds used for general
"It's an historical milestone in the evolution of DLT in the
capital market space," Newns told Reuters.
DLT is the technology that underpins cryptoassets such as
bitcoin, and Newns said the benefit for investors would come
from "atomic" or trading and settlement in a single,
Trading and settlement typically span two days in mainstream
markets, creating risks such as the possibility of one side of
the transaction going bust before completion, which ties up
liquidity and capital.
"The option of instantaneous settlement is nothing short of
revolutionary," Newns said.
R3, the company behind the DLT technology used by SDX, said
the bond issue was being watched closely by financial markets
"This is one of the biggest changes we are likely to see in
financial market infrastructure in our lifetime," R3 co-founder
Todd McDonald said.
SDX received two licences in September from Swiss regulators
for initial digital offerings and secondary trading and
settlement of shares and bonds.
Newns said SDX would also explore digital derivatives,
though cryptoassets were "not part of our immediate offering".
"There are more transactions in the pipeline. This is very
much just the beginning," Newns said.
Newns is the third head of SDX, a project which has faced
delays in going live since plans for the platform were unveiled
(Reporting by Huw Jones; Editing by Toby Chopra and Alex