Post-trade blockchain startup Paxos has been given the go-ahead from the Securities and Exchange Commission to process transactions in the US equities market.
Credit Suisse and Société Générale will be the first in a group of early adopters to use Paxos Settlement Service, settling US equities outside the legacy infrastructure for the first time in nearly half a century. Instinet has also committed to using the platform.
A private, permissioned blockchain the service allows for the bilateral simultaneous exchange of cash and securities to settle trades and is backward-compatible with current processes, simplifying integration.
Charles Cascarilla, chief executive officer and co-founder of Paxos, states: "This is an important first step on our journey to re-imagine the entire post-trade infrastructure, and one that creates immediate benefits for market participants.”
Emmanuel Aidoo, head of digital asset markets at Credit Suisse, agrees: “We believe the process of securities settlement can be greatly optimized using blockchain, and with Paxos Settlement Service we will benefit from these efficiencies first hand. We see this as a significant and important milestone in our Digital Asset Markets strategy and foresee opportunities to leverage this product across numerous asset classes in the future.”