Lykke & Nxchange to Launch New Tokenized Securities Exchange

  • Experienced trading platform developers, Lykke and Nxchange, will be launching a tokenized securities exchange. 
  • In addition to cryptoassets, the new exchange will facilitate the trading of traditional assets such as equities and bonds.

Lykke, a Switzerland-based developer of a blockchain-enabled ”global marketplace for the free exchange of financial assets”, and Nxchange, a “regulated market / multilateral trading facility-licensed” Dutch securities exchange platform, have partnered to launch a Europe-based regulated tokenized securities exchange.

According to the announcement’s press release, the partnership will involve Lykke becoming an equity shareholder in Nxchange.

The development of the new securities exchange platform will be funded by Lykke.

Trading Cryptoassets, Equities, Bonds, Investment Products

Notably, the exchange will use proprietary blockchain-enabled “cryptoasset trading infrastructure” developed by Lykke. Nxchange is expected to contribute to the project by helping to “facilitate safe and regulated trading” on the new tokenized securities exchange.

Investors will be able access “a far greater and more diverse variety of financial assets” via the regulated platform, and the Lykke Nxchange wallet will be provided to users so that they can “access and store digital assets on the exchange.”

Any asset or security such as traditional equities, bonds, loans, and investment products may be “tokenized and traded” on Lykke and Nxchange’s blockchain-powered trading platform.

Moreover, the exchange will use “embedded” smart contracts to “guarantee the rights of all users” - which includes the distribution of dividends, “voting rights”, and “asset ownership.”

A "More Equitable And Democratic Financial World"

Nxchange has also partnered with ABN Amro, the third largest bank in the Netherlands, in order to develop a distributed ledger technology (DLT) based bank account. It will be used to settle transactions in “real-time against fiat currencies” - which will be held in the “custody of ABN Amro clearing bank.”

Commenting on the development of the tokenized securities exchange, Richard Olsen, the founder of Lykke Corp. and futures commission merchant, OANDA, said:

This is a historic day - not only for Lykke and Nxchange as companies – but for our broader shared vision that is targeted at a more equitable and democratic financial world. The increasing acceptance of digital assets and blockchain infrastructure as the technology of the future correctly comes with a greater emphasis on regulation and compliance. This partnership envisages to satisfy all these things while still bringing all the benefits of transformative technology to any individual who wishes to access or exchange anything of value.

Richard Olsen

"Real-Time, 24/7, Transparent" Capital Market Transactions

Marleen Evertsz, the founder and CEO of Nxchange, remarked: 

We believe that the time has come for a more modern form of capital market transactions: efficient, real-time, 24/7, transparent, and supported by compliance procedures that assure maximum security. We are delighted to partner with Lykke and to join forces in building the Next Generation Stock Exchange.

Marlene Evertsz

As CryptoGlobe reported recently, South Korea-based crypto exchange, Bithumb, and American crowdfunding platform, SeriesOne, have announced that they will be launching a US-based securities token exchange.

The exchange is expected to go live in early 2019.

Ontology's New Multichain Design to Compete with Cosmos, Polkadot, and Plasma

The developers of Ontology, a blockchain-based “distributed trust” network for deploying decentralized applications (dApps), have argued that a single blockchain network cannot meet all types of business requirements.

Multiple Blockchains Are Needed For Different Business Requirements

As noted in a Medium blog post, published by the Ontology Team on May 17th, 2019, “blockchains with different architectures and features” are needed for various business use cases. Separate blockchain networks also need to communicate with each other and their “intended value” will not be “realized” if protocols are not developed to facilitate blockchain interoperability, Ontology’s developers wrote.

To facilitate communication between independent blockchains, Ontology’s team recommends creating a “multichain system.” To promote the development of such a system, the distributed trust network’s architects have released a design, or blueprint, for a “lightweight and safe” multichain solution which can manage cross-chain communication.

Allowing For Interaction Between Mainnet And Sidechains

As mentioned in Ontology Team’s blog, the solution will use the Ontology blockchain as its “main chain,” while integrating support for “side-chains whose architecture” is compatible with the Ontology mainnet. This type of setup, the platform’s developers explained, will allow for interaction “between the main chain and side-chains, and also between side-chains.”

A multichain contract will be issued (by the main network), in order to manage all sidechains that are linked to Ontology’s main blockchain, the Ontology team noted. Moreover, the "cross-chain interaction between source chain and target chain” is also performed by issuing a cross-chain management contract, Ontology’s developers explained.

The “proof of cross-chain interaction” is carried out by “synchronizing key block headers and other state information,” Ontology’s blog stated.

Comparing Ontology's Design With Other Blockchain Interoperability Platforms

Going on to compare Ontology with the other major platforms which aim to provide blockchain interoperability, the distributed trust network’s developers mentioned that Plasma, Cosmos, and Polkadot do not support “sidechain to sidechain crosschain” communication - whereas Ontology’s proposed solution does.

Moreover, Ontology and Polkadot’s cross-chain infrastructure supports “all information” whereas Plasma, designed by Vitalik Buterin and Joseph Poon, and Cosmos are only able to support “all assets.”

Notably, Ontology’s development team has already launched their cross-chain communication testnet. Developers of Cosmos, Polkadot, and Plasma have not yet released their cross-chain testnets, the Ontology team noted.