The Seychelles Stock Exchange (MERJ) became the first such institution to list a tokenized security for trading.
MERJ, licensed by the country’s Financial Services Authority as a securities exchange, clearing agency and securities depository (CSD), has issued a token share to represent the platform’s own assets. The exchange’s CEO, Edmond Tuohy, said:
“MERJ has fully used its complex ecosystem to issue the world’s first officially registered stock token. We combine the best of the old world and the new to provide the missing infrastructure for the growth of digital assets.”
The exchange reported that it uses the Ethereum blockchain to record ownership rights to shares, and stated that currently “this is the best supported protocol for these purposes.” On the exchange’s listings page, the tokenized security has the ticker MERJ-S and is currently trading at a price of $2.42 with a declared market capitalization of $21,015,781.
MERJ also plans to reduce costs for investors and issuers by using blockchain to optimize a number of processes in the securities markets, including issuing, maintaining shareholder registers, complying with laws, distributing shares and voting.
“This technology creates a point of access to capital markets, which is particularly suitable for ecosystems that actively use mobile devices in many emerging markets,” the report says.
MERJ claims that, having a license of a securities exchange, a clearing agency and a securities depository, it has all the opportunities to “take advantage of many advantages of tokenization”.
“Regardless of whether they issue tokenized or traditional shares, companies are not going to operate in a jurisdiction that does not meet high international standards, as this will attract more attention from global regulators,” Tuohy said.
“We have spent three years working with our regulators to create a reliable and compatible structure for issuers who want to take advantage of distributed ledger technology to work in the stock markets,” he added.
Asset tokenization is becoming increasingly popular and is increasingly receiving regulatory approval. Recently, the German regulator approved the sale of tokenized bonds for $280 million. In addition, this summer, the US Securities and Exchange Commission (SEC) approved the public offering of Blockstack startup tokens in the amount of $28 million