Gibraltar Stock Exchange to Offer Digital Debt Securities

The exchange operator says that 'tokenized' financial instruments make more liquid markets

The Gibraltar Stock Exchange (GSX) announced on Tuesday that it is going to be launching digital debt securities and digital funds. These assets will be listed as ‘smart,’ ‘digital’ or ‘tokenized’ when they are on the exchange.

They will also begin listing immediately. That means traders will soon have access to, amongst other things, ‘tokenized’ corporate bonds, convertible bonds, derivative securities, and close-ended funds.

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Trading in these new assets will be undertaken on the blockchain. GSX says that it hopes it will be able to get more firms to list digital representations of funds and debt instruments on its exchange in the near future.

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Tokenized assets, better liquidity

The exchange operator said in a statement that by ‘tokenizing’ their assets, firms could improve the liquidity of any listed assets. On top of that, GSX claims the transparency that blockchain contracts bring to the marketplace makes it easier to adhere to regulatory requirements.

“This is a historic moment for GSX, we have worked incredibly hard to reach this point, and we are now at the precipice of a truly transformational period for the capital markets,” said GSX chief executive officer Nick Cowan. “We now have an unparalleled opportunity for the GSX to become a frontrunner in the emerging digital securities market.”

Unlike many other jurisdictions, Gibraltar has eagerly embraced blockchain technology. The British overseas territory’s regulator, the Gibraltar Financial Services Commission, was one of the first financial authorities to implement some form of regulation governing the nascent technology.

The regulator’s distributed ledger technology license, in particular, has become extremely popular with firms looking to garner legal support for their activities. Since the start of the year, we’ve seen a number of firms, eToro amongst them, receiving those licenses.

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