BSTX Gains SEC Approval for Blockchain-Driven Security Exchange

BSTX, a collaboration between tZero and Boston Options Exchange (BOX) Digital Markets, has obtained SEC approval to establish a blockchain-based securities exchange. The exchange aims for swift settlement (T+0 or T+1) through blockchain transactions, offering market data on its own blockchain and catering to both retail and institutional investors. This approval marks the SEC's recognition of blockchain's role in modernizing capital markets, with BSTX also aiming to support regulated crypto markets in the future.

BSTX Receives SEC Approval for Blockchain-Powered Securities Exchange

January 28, 2022

Boston Stock Transfer & Trust Company (BSTX), a collaborative venture between tZero and Boston Options Exchange (BOX) Digital Markets, has garnered the United States Securities and Exchange Commission (SEC) nod to operate a trailblazing securities exchange underpinned by blockchain technology.

This groundbreaking exchange aspires to expedite or accelerate settlement (T+0 or T+1) by leveraging the blockchain's transactional capabilities. Additionally, BSTX intends to furnish market data inscribed upon the blockchain, akin to the function of an Oracle. This process will be executed on a blockchain operated by BSTX, according to the company's statement.

Accessibility to the exchange will be extended to both individual and institutional investors.

BOX has relentlessly pursued SEC approval for an exchange since the advent of 2020. The initial iteration of its application sought to establish a Security Token Offering (STO) platform.

In 2020, the SEC denied BOX's proposal to record end-of-day securities ownership balances and assorted trading data onto the Ethereum blockchain.

"The SEC has taken a pivotal step forward with today's approval of BSTX as a national securities exchange," declared BSTX CEO Lisa Fall in a statement. "We are enthusiastic about our ongoing collaboration with the SEC to launch a fully compliant exchange. Our aim is to equip capital markets with contemporary tools that empower issuers and investors alike."

BSTX has unveiled its aspirations to eventually integrate regulated crypto markets alongside its equity offerings.

In an official release, the SEC stipulated that its approval is contingent upon BSTX's membership in pertinent national market system plans. These frameworks are designed to facilitate the dissemination of real-time market information. Furthermore, the SEC will require BSTX to affiliate with an intermarket surveillance group, an industry entity dedicated to coordinating regulatory compliance.

"Today's approval marks merely the commencement of BSTX's journey," remarked Fall. "We are both encouraged and invigorated by the outreach we have thus far received from participants in both traditional and non-traditional finance. Through future rule filings, we intend to introduce a succession of further innovations that will be advantageous to both the issuer and trading communities."