Open-source Web3 platform Tezos just announced the launch of its token standard tailored for the Swiss market. The “CMTA tokens (CMTAT) standard” is specially designed to be utilized by Swiss corporations in the issuance and trade of their shares.
A Recap of Related Events
Last year, regulated stock exchange BX Swiss successfully conducted a pilot test for the issuance, trading, and settlement of digital investment assets using blockchain technology. It was participated in by the big players in the financial industry, namely Credit Suisse, Pictet, and Vontobel. The test was designed to demonstrate the feasibility of settling securities transactions using digital tokens and blockchain technology, which could help improve the efficiency and security of financial transactions.
The technical expertise in the issuance of tokenized investment products was provided by the Capital Markets and Technology Associaton’s (CMTA) token standard and Taurus during the pilot. Meanwhile, the settlement of the traded tokenized securities was settled in Swiss francs through the DLT2Pay smart contract and payment platform of targens.
All three processes (issuance, trading, and settlement) in the proof of concept were finished in just a couple of hours. This comes in contrast to the traditional model employed by present financial institutions that could last for days.
The participants in the test expressed confidence in the technology and its potential to transform the financial industry.
CMTAT Launch
Fast-forward to the end of February this year, Tezos proudly announced the deployment of the CMTAT. This system was developed by CMTA for the tokenization of securities in compliance with all applicable Swiss laws.
The CMTAT standard aims to provide a secure and efficient way for Swiss corporations to tokenize their shares and enable trading on Web3. The implementation on Tezos will allow corporations to take advantage of the platform’s features such as smart contracts, which can automate processes such as dividend payments and shareholder voting, among others.
There are hopes that the implementation of the CMTAT standard on Tezos will further promote the adoption of blockchain technology in Switzerland and beyond.
About the Tezos Platform
Tezos is an open-source platform on the blockchain that enables the creation of smart contracts and decentralized applications (dApps). It utilizes a proof-of-stake consensus algorithm, which allows token holders to participate in the validation of transactions and earn rewards for doing so.
The network has a unique on-chain governance system that allows stakeholders to propose and vote on changes to the protocol, making it adaptable to changing market conditions without triggering a split or “fork”. Tezos is designed to be self-governing and upgradeable, ensuring that the platform remains flexible and scalable over time.
Likewise, it supports a variety of programming languages and has gained popularity among developers and enterprises due to its focus on security, scalability, and community-driven development.
Final Thoughts
Tokenization of shares offers several benefits, including increased liquidity, lower costs, and greater efficiency. By tokenizing shares, corporations can:
- Enable trading on blockchain platforms, which can increase liquidity by allowing investors to buy and sell shares easier and quicker.
- Lower costs by reducing the need for intermediaries such as traditional brokers and clearinghouses, and can make the process of shareholder voting and dividend payments more efficient by using smart contracts to automate these processes.
- Provide greater transparency and security, as ownership of shares can be easily tracked on a decentralized ledger.
Given these, the CMTAT standard can provide greater accessibility to investment opportunities, reduce costs and increase efficiency in trading and corporate actions, and enhance transparency and security going forward.
Giancarlo is an economist and researcher by profession. Prior to his addition to Blockzeit’s dynamic team, he was handling several crypto projects for both the government and private sectors as a Project Manager of a consultancy firm.
