It looks like 2019 is gearing up to be a year of progression and innovation, as the crypto industry seeks out ways that institutional investors can get involved.
DX is based in Estonia, and powered by Nasdaq, and they have decided to create a way that allows investors to purchase shares of major firms with tokens.
The trading platform will soon be launched on January 7th, and it affords an opportunity to purchase crypto tokens, which are representative of the shares. These shares would coordinate with tech firms that are already listed with the Nasdaq exchange.
Though the purchases would not involve all crypto assets, investors would have the option of select cryptos and fiat currencies in an effort to purchase the tokens on the DX exchange.
As this project operates, they intend to employ the matching engine from Nasdaq to help with the process of trading, though it is also meant as a preventative measure to stop market manipulation. Instead of actually owning the shares, the investors will have access to tokens that represent the shares, according to COO Amedeo Moscato. Continuing, he noted,
“Henceforth, when they become a token holder, they own stocks or portions of the company’s stock, as the tokens are backed 1:1 to the real-world stocks. That makes them entitled to the same cash dividends that the stocks are worth.”
Ultimately, the intention is for this exchange to offer both stock services and P2P crypto trading.
During these transactions, DX Exchange’s partner MPS Marketplace Securities, Ltd. purchases the stocks and creates the corresponding ERC-20 tokens as the representative assets, based on the demand from investors. Instead of sharing the same funds internally with MPS, they will be in a separate account to protect the company from potential problems.
While MPS will be governed by the Cyprus Securities and Exchange Commission, DX Exchange will need to abide by the regulations set forth in European Union.
When the launch begins MPS plans have shares from the following tech companies in their possession: AlphaBet, Apple, Amazon.com, Baidu, Facebook, Intel Corporation, Microsoft Corporation, Netflix, Nvidia, and Tesla. Along with the matching engine from Nasdaq, SX Exchange plants to employ the financial information exchange (FIX) protocol from Nasdaq as well.