The Canadian Securities Exchange announced it’s introducing an innovative securities clearing and settlement platform with blockchain technology. Using the platform, companies can issue conventional equity and debt through tokenized securities, which would be offered to investors through Security Token Offerings (STOs).
Unlike blockchain-based cryptocurrencies, the STOs will be subject to full regulation by applicable securities commissions. The platform is expected to provide major benefits to investors and the Canadian financial services community, including real-time clearing and settlement and substantial cost and error reductions compared to conventional clearing services. The CSE intends to file an application to seek approval from Canadian regulators to recognize the new clearinghouse, which it will operate.
The CSE has also signed an MoU with Kabuni Technologies, a private company based in Vancouver, British Columbia. Kabuni intends to file a prospectus with the British Columbia Securities Commission for approval to issue tokens to investors through a STO. Subject to meeting the requirements of the BCSC and CSE, the tokens would be traded on the CSE’s existing equity trading platform. This would mark the first time a tokenized security has been listed for trading on a recognized securities exchange.