Singapore Exchange Successfully Tests Tokenized Asset Settlement. Singapore Exchange (SGX) has successfully tested the use of blockchain technology for tokenized asset settlement. According to the announcement on Sunday, it has developed a Delivery versus Payment (DvP) mechanism. This is less than three months after the five-way partnership announced on August 24.
The nation’s Ministry of Communications and Information announced the newly completed Delivery Versus Payment (DvP) in a press release on Sunday. According to the November 11 announcement, the current DvP system will ease the post-trade processes. Furthermore, reduce the settlement cycles. The system aims to achieve that with the help of smart contracts. The system builds upon project Ubin, launched two years ago as an industry collaboration. This is to explore the use of distributed ledger technology (DLT) for clearing and the settlement of payments and securities.
The Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX) developed the prototypes. Also, the Chinese technology firm Anquan Capital, Nasdaq and the consulting firm Deloitte Touche Tohmatsu were included.
The blockchain technology is a digitized and decentralized, public ledger of all cryptocurrency transactions.
Sopnendu Mohanty, chief FinTech officer at MAS said in the press release: “Blockchain technology and asset tokenization are fuelling a new wave of innovation globally. However, Delivery Versus Payment has demonstrated the value of blockchain technology.
Meanwhile, SGX’s head of technology, Tinku Gupta, revealed that the company is working towards securing a patent, it’s first ever, for the “unique methodology” it has developed to “empower real-world interoperability of platforms, besides the simultaneous exchange of digital tokens and securities”.
Singapore Exchange Successfully Tests Tokenized Asset Settlement. The prototype test shows that financial institutions and corporate investors are able to carry out the simultaneous exchange. Also, final settlement of tokenized digital currencies and securities assets on different blockchain platforms.
“The propensity of the system to perform these activities simultaneously improves operational efficiency and reduces settlement risks,” it says, further “DvP settlement facility, inter-ledger interoperability, and investor protection can be accomplished through specific solutions designed and built on blockchain technology.”
The Singapore Exchange announced the strategy to work with the Central Bank and concerned stakeholders to utilize blockchain technology within the settlement system in August, saying the group would examine Project Ubin’s existing protocols and determine how best to leverage them for a DvP platform.