Malta Stock Exchange to Launch Blockchain-Powered Trading Platforms for Security Tokens
The Malta Stock Exchange is going after the thriving security token sector with new partnerships unveiled on Thursday to develop and launch blockchain-powered trading platforms for security tokens, according to a news release.
Through a newly launched subsidiary called MSX, the Malta Stock Exchange has signed two Memoranda of Understanding (MoUs) with OKEx, one of the world’s largest cryptocurrency exchange platforms, and Fifth Force, the operator of German blockchain-based equity fundraising platform Neufund.
The collaboration with OKEx will focus on developing an institutional grade security tokens trading platform, which will operate under the name OKMSX.
Tim Byun, chief risk officer and head of government relations of OKEx, told CoinJournal:
“We see the initial uses cases for security tokens to include asset backed security tokens such as real estate backed tokens, mortgage backed tokens, and/or other fixed income tokens, equity tokens that represent equity shares of a company, and security tokens that are native to a specific service provider which provides certain benefits, such as unique products, services, or a return element.
“We hope that the issuers of security tokens will reside in and come from ‘Blockchain Island’ and the broader European Union (EU).”
Continuing on the momentum of the MoU signing, Byun said OKEx and MSX will now formalize an agreement for the OKMSX platform, a joint venture and new entity. “We hope to be first operational security token exchange in the EU with a roll-out target by end of the year,” he added.
Meanwhile, the partnership with Fifth Force will aim at building “the world's first regulated decentralized global stock exchange” for listing and trading tokenized securities alongside crypto-assets, according to Zoe Adamovicz, CEO and co-founder of Fifth Force.
A separate release by Fifth Force claims Binance is also involved in the project, which will see Neufund becoming “the first end-to-end primary issuance platform for security tokens, in particular equity tokens” in the EU. Binance will be responsible for creating an exchange ready for security tokens, including equity tokens.
Fifth Force, Binance and MSX are looking to conduct a pilot project later this year which will include the public offering of tokenized equity on Neufund’s primary market that may later be tradable on the Binance platform and other crypto exchanges pending regulatory and listing approvals.
Joe Portelli, chairman of the Malta Stock Exchange, said with the upcoming pilot project, “we become a worldwide pioneer in digital finance.”
“Malta is on the cusp of becoming a center of excellence within the global digital innovation landscape. These partnerships leverage our expertise on the compliance and regulatory front to truly be a trailblazer within the security token sector,” Portelli added.
For the Malta Stock Exchange and its innovation arm, the new partnerships will allow the stock exchange to operate with the private sector in both the primary market with operators such as Neufund, and the secondary market with operators such as OKEx, Silvio Schmebri, the parliamentary secretary for digital innovation and finance, told CCN.
The announcement comes at a time when Malta is pursuing the title of “Blockchain Island” as it aims to become a hotspot for blockchain and cryptocurrency innovation. In June, the Maltese Parliament approved three bills on cryptocurrency and blockchain designed to attract foreign entrepreneurs and startups in the space.
Some already made the leap including Binance, OKEx and BitBay which chose to either relocate or expand to the crypto-friendly island.