21X – a distributed ledger technology (DLT)-based market infrastructure for tokenized securities, which has applied for a license to operate a DLT trading and settlement system (DLT TSS) under the European Union’s DLT regime (DLTR) – has announced a ground-breaking strategic partnership, with SBI Digital Markets (SBIDM), based in Singapore and a subsidiary of Japan’s largest online financial services group, SBI Holdings.

Under the terms of the collaboration, SBIDM will list tokenized securities on 21X’s DLT market, which provides a matching, trading and settlement system on a public permission-less blockchain. 21X is expected to be the first fully regulated DLT market operator under EU DLTR, making this collaboration a milestone moment – the first time that tokenized securities can be traded on an exchange under the regulations of the EU’s European Securities and Markets Authority (ESMA).

Within the strategic partnership SBIDM is acting as a listing agent and service provider for asset tokenization and custody of tokenized securities, admitted to primary and/or secondary markets on 21X. SBIDM and 21X are planning to issue, distribute and trade a suite of tokenized securities on 21X, with an initial focus on exchange-traded notes (ETNs) and exchange-traded funds (ETFs).

This compelling partnership will open distribution corridors for SBIDM investors from APAC regions – including Singapore, Thailand, and Japan – into Europe, and vice versa.

Announcing this landmark agreement, Max Heinzle, founder and CEO of 21X, stated:  “For over a decade SBI has been both an innovator and early mover in the burgeoning digital asset space. Our strategic partnership with SBIDM marks a significant point in the development of 21X and the globalization of blockchain-leveraging capital markets. With our license to operate imminent, this collaboration will allow SBIDM, which holds an outstanding market position in Asia, to use 21X as the gateway to Europe for trading and settlement of digital securities, taking advantage of the first and only fully regulated exchange in Europe for tokenized securities, at launch.”

Winston Quek, CEO of SBI Digital Markets, said: “SBI Digital Markets’ agreement with 21X marks a significant step forward for the entire tokenized securities industry. Furthermore, 21X’s fully regulated DLT market aligns perfectly with SBIDM’s commitment to build a global exchange and distribution network for tokenized securities. To this end, we have been working with our ecosystem partners over the last months to establish a pipeline of tokenized assets to list on 21X where SBIDM will act as a global custodian and service provider. This collaboration is a testament to our shared vision for the future of digital securities.”

CK Ong, COO of SBI Digital Markets, added: “We are pleased to partner 21X as the first fully regulated exchange in Europe for institutional-grade trading of tokenized securities. With the strategic partnership, SBIDM will be leveraging the advantages of a blockchain-based exchange, including efficiency gains, and secure, and unparalleled degrees of disintermediation in trading and settlement.”

21X’s DLT exchange offers advantages over traditional exchanges, such as the elimination of clearing, atomic matching and settlement, increased accessibility, the possibility for self-custody and cost-effectiveness through unparalleled degrees of automation.

Source: SBI