SBI Digital Markets (SBIDM), a subsidiary of Japan’s largest online financial services group, SBI Holdings, said it is working with German firm 21X, a distributed ledger technology (DLT)-based market infrastructure provider on listing tokenized securities.
SBIDM will list tokenized securities on 21 X’s DLT market, which has a trading and settlement system on a public permissionless blockchain.
21X said it is in the process of applying for a license to operate a DLT trading and settlement system (DLT TSS) under the European Union’s DLT regime (DLTR).
Once approved, 21X is expected to become a fully regulated DLT market operator in Europe, overseen by the European Securities and Markets Authority (ESMA).
SBIDM to Handle Custody of Tokenized Securities
SBIDM said it will serve as a listing agent and service provider for asset tokenization and handle the custody of tokenized securities on 21X.
The focus will be on issuing and trading exchange-traded notes (ETNs) and exchange-traded funds (ETFs) on 21X’s DLT platform.
SBIDM has a strong presence in the Asia-Pacific region, with investors from Singapore, Japan, and Thailand the firm said it will gain access to European markets through this new venture.
“Our strategic partnership with SBIDM marks a significant point in the development of 21X and the globalization of blockchain-leveraging capital markets,” said Max Heinzle, founder and CEO of 21X.
He added that SBIDM, with its strong presence in Asia, will use 21X as a gateway to Europe, taking advantage of the first fully regulated DLT exchange for tokenized securities.
Tokenization Trend
The growing trend of tokenizing traditional assets has caught the attention of legacy financial institutions.
According to a recent report by Moody’s, a leading investment risk assessment firm, the value of tokenized funds has surged from $100 million at the beginning of 2023 to approximately $800 million today, driven by the rising tokenization of U.S. treasuries.
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