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Seychelles national stock exchange (MERJ) has issued off its digital initial public offering (IPO), that is poised to be the inaugural blockchain-based IPO in the world.

The Thailand Bond Market Association plans to issue cryptocurrency to facilitate bond trading, and connect its system with the central bank's cryptocurrency project. The Bank of Thailand and commercial banks are currently experimenting using digital currency for interbank settlement. The coverage includes inter-bank bond trading, repurchase transactions and regulatory compliance and data reconciliation.

The Banque de France is calling for applications to experiment with a wholesale central bank digital currency for interbank settlements.

South Korea's central bank is testing a platform for bond transactions based on distributed ledger technology, a local media source reports. The Bank of Korea (BoK) is investigating whether a blockchain-powered system could speed up transactions in the Korean bond markets.

"Innovative technologies, such as distributed ledgers, allow securities to be issued or represented in a new form known as digital tokens. Such "tokenisation" of securities will alter post-trade clearing and settlement, and could improve efficiency in some dimensions. But the fundamental trade-offs involving credit risk and liquidity remain in a tokenised world. To succeed, tokens will need to interoperate with account-based systems, at least in the interim."

The Australian Securities Exchange (ASX) has indefinitely postponed the launch of its blockchain-based alternative of its equities clearing and settlement system. Originally set for a launch by the end of 2020, the exchange earlier delayed it till April next year. Now, however, there is no specified timeline for the launch.

A select group of U.S. equity trades is being settled using a private blockchain as Paxos Trust Co. pushes for approval to offer its service to more dealers. Broker-dealers Credit Suisse Group AG and Nomura Holdings Inc.'s Instinet are swapping cash for stocks using the Paxos Settlement System, the first operational use of a private blockchain in U.S. equity markets, Paxos co-founder and Chief Executive Officer Charles Cascarilla said in an interview. He expects Societe Generale SA to join soon.

The Paxos Settlement Service has gone live, allowing for the simultaneous exchange of cash and a select number of U.S.-listed securities on Paxos' own private version of ethereum.

Deutsche Börse, Deutsche Bundesbank and Germany's Finance Agency successfully tested a settlement interface for electronic securities, working with a range of other market participants. Securities settlement using distributed ledger technology (DLT) is performed with the aid of a "trigger" solution and a transaction coordinator in TARGET2, the Eurosystem's large-value payment system. In doing so, the participants have demonstrated that it is possible to establish a technological bridge between blockchain technology and conventional payment systems to settle securities in central bank money with no need to create central bank digital currency.

If anything, what the central bank RTGS/LSM two-step teaches us is that we need a good balance between fast and slow. Sure, real-time settlement is a nice feature. But let's also have delayed settlement. If brokerages have a choice to use some combination of two-day and real-time settlement, we may arrive at a socially optimal stock settlement rate.

The European Central Bank published a report on the use of distributed ledger technology (DLT) in securities post-trade processes. It categorises securities issuance and post-trade processes into models depending on how DLT is used in each case, drawing implications for the use of DLT at different stages of the securities life cycle, from issuance to custody and settlement. It recommends that, in order to prevent market fragmentation, the adoption of DLT-based solutions should be based on common practices and standards that enable DLT systems to interact with both each other and conventional systems.

The experiment consisted in the subscription to EIB-issued digital bonds by investors, for a total amount of 100 million euros. Cash settlements were represented by Central Bank Digital Currency issued on a blockchain. From a technological standpoint, the experiment required the development and deployment of smart contracts under secured conditions, so that the Banque de France could issue and control the circulation of CBDC tokens and so that CBDC transfer occurred simultaneously with the delivery of securities tokens to the investors' portfolio, in a Delivery versus Payment. The experiment was conducted in cooperation with the members of a banking syndicate composed of Goldman Sachs International, Santander and Société Générale.

Paxos Trust Company has completed a same-day settlement of US-listed equity trades in partnership with Instinet and Credit Suisse on its Paxos Settlement Service permissioned blockchain solution. Paxos said the project demonstrated its ability to enable same-day settlement for trades conducted throughout the day. In the current system, settlement can only occur the same day if trades are completed before 11 AM ET and therefore is rarely utilized. The platform is said to be interoperable with the legacy clearing system and can facilitate settlement on any time cycle.

State Street's Currenex trading technology arm is working with London-based FX trading infrastructure provider Pure Digital to to create an institution-focused digital currency trading platform. It will be a fully automated over-the-counter market for digital assets, with physical delivery and bank custody. Scheduled for launch in mid-2021, the new platform will reportedly allow institutional investors to trade using bilateral credit and multiple custody solutions.

On June 18, the Banque de France successfully conducted a central bank digital currency (CBDC) experiment with SEBA Bank, as part of the experimental program launched in March 2020. The CBDC was used to simulate the settlement of listed securities and trigger their delivery in the TARGET2-Securities (T2S) test environment, using T2S's conditional securities delivery (CoSD) feature. The Banque de France simulated CBDC issuance on a public blockchain, preserving control and confidentiality of transactions using a dedicated smart contract. https://www.banque-france.fr/en/communique-de-presse/banque-de-france-conducts-new-central-bank-digital-currency-experiment

FAT Brands, the parent company of franchises such as Fatburger, Bonanza Steakhouse and Ponderosa Steakhouse, in cooperation with digital securitization platform Cadence, is tokenizing a bond offering on the ethereum blockchain

Paxos Trust, a blockchain company that caters to financial institutions, has been given the green light to settle stock trades in near real-time in a direct threat to the Depository Trust & Clearing Corp.'s half-century equity market dominance.

"The SEC has put significant limits on Paxos's experiment. Only about 140 of the most actively traded, least volatile stocks, like Exxon Mobil Corp. and Bank of America Corp. , are eligible for the project. The number of trades Paxos can settle will also be capped at 1% of average daily trading volume of those stocks, according to the SEC's letter."

Deutsche Boerse and Swisscom utilize different blockchain protocols to settle securities transactions by exchanging cash tokens for tokenized shares in a joint proof of concept involving R3's Corda and IBM's Hyperledger Fabric.

This report discusses some potential design choices and includes a non-exhaustive list of questions that wholesale digital token developers may need to consider. Important considerations include availability; issuance and redemption; access; underlying assets/funds and claims; transfer mechanism; privacy and regulatory compliance; and interoperability. Depending on the design choices made, there could be a number of implications for safety and efficiency of the token arrangement.