Deutsche Börse Group, Germany-based owner of the Frankfurt Stock Exchange, has partnered with major telecoms and IT provider Swisscom and Switzerland-based fintech firm Sygnum to build what the firms are calling a “trusted digital asset ecosystem.”
Swisscom announced Monday that the proposed ecosystem would provide a number of solutions in the digital assets space, including issuance, custody, liquidity provision and banking services, all using blockchain technology.
As part of the partnership, Deutsche Börse has invested in Custodigit AG, a joint venture between Swisscom and Sygnum, which provides a technical solution for custody of cryptocurrencies.
Deutsche Börse and Sygnum will also become shareholders of blockchain startup Daura AG, which provides a platform for the issuance, transfer and registration of shares in Swiss SMEs (small- and medium-sized enterprises), providing non-listed firms with access to the capital markets, according to the announcement.
Jens Hachmeister, managing director of DLT (distributed ledger technology), crypto assets and new market structure at Deutsche Börse said:
“Continuing our investments in new technologies and driving the development around DLT forward is a key focus of Deutsche Börse Group. Switzerland, known to be a nucleus for financial markets innovation, is the ideal starting point for Deutsche Börse to drive this evolution forward.”
Sygnum is also in the process of obtaining a Swiss banking and securities dealer license from the Swiss Financial Market Supervisory Authority (FINMA), Swisscom said. Once the license is in place, Sygnum will provide banking services such as custody, deposits, lending, capital issuance via tokenization, brokerage and asset management within the planned ecosystem.
The trio partnership is currently awaiting merger approval, the firm said, adding that other products and services are planned for launch later this year in a “regulatory compliant” environment.
Deutsche Börse has also previously announced that it is planning to develop a blockchain-based system for securities lending. The firm said in March 2018 that it plans to develop a system that can offer more efficient securities settlement using technical support from financial management firm HQLAX and the Corda platform from blockchain startup R3.
Frankfurt Stock Exchange image via Shutterstock; diagram courtesy of Swisscom