The Gibraltar Stock Exchange (GSX) is enabling financial firms to list blockchain based securities on its GSX Global Market Platform, the company declared on April 9.
The exchange declared this news on Tuesday, saying that the current regulatory laws provided by the Gibraltar Financial Services Commission (GFSC) cover use of Blockchain and Distributed Ledger Technology (DLT) by issuers as a part of recording ownership.
From today, the GSX allows listing various new products like digital, smart or tokenized securities such as Corporate Bonds, Convertible Bonds, asset-backed securities, derivative securities, open-ended funds, and closed-ended funds.
Nick Cowan, who is the CEO and founder of the GSX Group stated:
“Our aim is to purchase blockchain to open up greater liquidity pools, making illiquid assets more accessible, and set the foundations to better democratize capital markets.”
GSX also said in the announcement that firms located in different countries outside the European Union can also join GSX platform. Hence, firms working in Iceland, Liechtenstein, Norway, and Switzerland can apply to join the GFX and present their financial products in the market.
When compared with the GSX Main market, GSX Global market offer lighter reporting scheme and disclosure framework, which will allegedly allow issuers with reduced timelines and listing costs.
As it is a popular stock exchange regulated in the European Economic Area (EEA), GSX Global Market doesn't require debt issuers with securities listed on the market to retain tax on coupons as per the UK Law. The current listings are done based on the merger of an incorporated tokenized securities exchange product by GSX Group's subsidiary Hashtacs and STO Global-X on April 5. The projects allow stock exchanges and various financial institutions to tokenize assets and improve their trading, clearing, and fixing of digital securities.
Gibraltar's financial regulator declared its DLT regulatory framework in January 2018, making it compulsory for companies using blockchain to “store or transmit value belonging to others” to apply for a license.
Gibraltar Blockchain Exchange a subsidiary of Gibraltar Stock Exchange has obtained a license from the GSFC in November 2018 to provide services to different participants.
The latest announcement only covers listing of digital debt securities and some tokenized firms, Cowan said that exchange-traded funds will release in the near future:
“ETFs are products that the GSX Group is especially interested in given our position as one of the largest fund administrators in Gibraltar, meaning we can support future ETF structuring and issuance.”