Singapore-headquartered CapBridge 1exchage (1X) on Tuesday announced that it would integrate blockchain technology to offer trading services as well as to register and track shareholdings of investors.
Unlike other financial institutions, the trading platform will use the public Ethereum mainnet and has partnered with Consensys and Equiom to deploy the decentralized technology.
Launched in 2014, Ethereum is the leader in smart contracts and has over 60 million users. 1X believes that a user base of this size would allow it to share a global liquidity pool, diversifying its investors, according to the press release shared with Finance Magnates.
The executives of the exchange are optimistic about the decade-old technology, as Choo Haiping, CEO of 1X, said: “With DLT-enabled shareholding registration, investors on the 1X platform can independently verify and validate their shareholdings in real time without the manual process of going through an exchange or a trust administrator. The immutable nature of DLT provides the assurance of accuracy in recording and verifying both investor identity and the associated shareholdings.”
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Equities trading on the blockchain
The exchange will leverage the smart contracts feature to permanently record the ownership data of the shareholders. This, according to the exchange, will provide “comprehensive” and “accurate” services to its clients.
“The DLT architecture further adds to the robust and efficient 1X infrastructure – providing a trusted environment for market participants to trade with assurance. We believe the enhanced level of trust that 1X offers will provide greater comfort to investors and encourage more demand for private securities listed on 1X,” Haiping added.
Regulated by the Monetary Authority of Singapore (MAS), CapBridge also has plans to integrate blockchain-based compliance services along with automated dividend issuance.
“Deployment of 1X on public Ethereum will increase visibility, lower the cost of compliance, drastically reduce the possibility of improper manipulation of the system of record and create positive growth for the private securities industry,” Joseph Lubin, founder of Consensys and co-founder of Ethereum, added.