Security Token Exchange
What is a securities exchange?
A securities exchange (or stock exchange) is a venue where traders can effectively buy and sell securities, such as shares, bonds or other financial instruments. It can be seen as a continuous auction market, where traders use the electronic trading platform to swap ownership claims. A security token exchange is effectively a stock exchange that supports the trading, deposit and withdrawals of security tokens.
The Benefits
Stock Exchanges use blockchain technology to manage their administration more effectively, and enable the trading of security tokens. There are many benefits including reducing the need for middlemen or organizations that custody assets, as well as preserving privacy, automating compliance, and increasing the speed at which trades are settled.
Business Opportunities
Blockchain has the potential to fit well into the custodial and financial market infrastructure. Providing efficiency gains that bring down the cost of issuance, fundraising, and listing down for platform and infrastructure providers, and thus their customers. In practice this means it becomes viable for these market players to serve the SME segment further down the long tail, increase the tradability of private securities, and more. With the potential of adding various self-service elements alongside core products and services.