Switzerland-based SIX Digital Exchange (SDX), which claims to be the “first” fully regulated digital asset exchange and Central Securities Depository (CSD), working in partnership with F10, an international Fintech and Insurtech Innovation Ecosystem and Aequitec, a digital share register and cap table firm, recently announced the “first-ever” tokenization of equity shares in a ‘fully regulated” CSD based on distributed ledger technology (DLT).
F10 will reportedly issue its shares with the SDX CSD where shares are tokenized, meanwhile, the share registry services will be offered by Aequitec.
As mentioned in the update, tokenized private shares are transferrable in the form of “dematerialized” intermediated securities vi a the SDX DLT platform according to Swiss law.
With this collaborative approach, financial institutions are able to move past the existing business model of tailor-made, one-by-one private placement, to a more sustainable, digitalized, “process-driven” business.
According to the announcement, expected benefits are greater overall efficiency and a lot more liquidity for private markets. This represents a key step towards improving the share registry process for private firms by leveraging blockchain/DLT.
By orchestrating processes across parties, the partnership aims to offer a seamless and intuitive user experience for issuers, investors, as well as SDX member banks.
This latest announcement represents a key milestone in the partnership with Aequitec highlighting the impact of SDX’s strategy to effectively engage with VC partners and the SME investor community.
Massimo Butti, Head of Equity at SDX, said:
“An ecosystem that supports private companies in their funding journey and reduces the complexities and inefficiencies of issuing private equity can only be achieved through collaboration: with existing and new players; by leveraging existing processes; and by creating new technical standards. The issuance of F10 shares on SDX is the result of the cooperation with different market actors. It provides a scalable blueprint for other issuers and participants to issue digitized shares and affirms that our private issuance market is open for business.”
Christian Wilk, CEO of Aequitec, remarked:
“With bankable shares our customers’ shareholders can safely store their private equity shares in bank custody. Moreover, with the help of Aequitec’s interactive workflows for capital increases and annual shareholder meetings, F10 as equity issuer can further streamline the processes and strengthen corporate governance practices, resulting in higher ESG ratings and better access to equity funding”.
Jonathan Seiler, CFO and Senior Investment Manager at F10, added:
“Beyond the clear advantages of managing our share registry and all related processes fully digitally at F10, we believe strongly in the power of collaboration to advance the financial industry. That’s why we are incredibly excited to be the first issuer of shares for this new innovative offer by our partner SDX and F10 alumni Aequitec.”