BSTX - Boston Security Token Exchange

BSTX - Boston Security Token Exchange

Photo Credits: DepositPhotos

Notice: This article is for informational and educational purposes only, and you should not take it as financial advice.

The Boston Security Token Exchange (abbreviated BSTX) is a new subsidiary of the Boston BOX Securities Exchange, but with one difference - instead of through the classic systems for conducting purchase transactions in the securities exchange, this exchange will use blockchain. Its launch is expected to happen soon, probably in the second quarter of this year, after approval for this form of securities business was issued this week by the US financial markets regulator SEC.

Faster and safer

Boston blockchain exchange has a plan to merge the best of the two worlds, the classic financial securities exchange and the cryptocurrency exchange based on the blockchain. The trading interface is more similar to that of cryptocurrencies, that transactions are conducted in a faster and more secure way than on other exchanges, but that the new exchange does not trade cryptocurrency, but the traditional one - shares. The advantage of the new technology is that the sale will be able to be concluded and implemented on the same day, and not within two days, as is the standard in traditional markets.

The shares will be traded on BSTX in the form of digital tokens, blockchain records that will represent a particular share or shares in equity funds. For a start, only fund-related tokens will be available on this exchange, and their plan is to expand the offer to all stocks available in the United States.

No crypto trading

Transactions will be recorded on their private blockchain, which means that traders will be able to monitor their own and others’ activities (of course, in an anonymous way). For now, the SEC has not allowed this exchange to trade stand-alone digital tokens (cryptocurrencies or NFTs), while there are still plans to trade in “tokenized” securities.

The new securities exchange will also be subject to its classic regulation and supervision, as will the other 16 currently active US securities exchanges. Private investors and institutions will also have access to trading on BSTX.

The blockchain market basically has no clear rules, for some, it is complete freedom, but it never gives customers complete security. Of course, there are security papers and protection on the part and the blockchain has a one-way function, but no one can guarantee complete security. The question is whether someone will be able to create the rules and control at least part of this story...