Stock exchange giant Deutsche Börse (NASDAQ:DBOEF) has revealed plans to establish a digital asset exchange as part of its growing list of offerings before the end of 2024.
The firm disclosed in its Investor Day 2023 report a blueprint for its mid-term plans. Deutsche Börse says in the 81-page report that will proceed with the development of a digital asset platform to serve institutional customers, positioning itself for “an evolving new ecosystem.”
The firm disclosed that despite the digital assets market capitalization surpassing $1 trillion and over $103 billion in average trading volume, institutional-grade offerings are noticeably lacking in the ecosystem. Deutsche Börse says its solution will address existing pain points in the industry, given its neutrality, credibility, and experience dabbling in regulated businesses.
Located in Germany, the company points to the existing Markets in Crypto Assets (MiCA) legislative framework and its streaks of compliance as pointers for future successes in its foray into Web3. Alongside the plans to roll out a digital currency exchange is Deutsche Börse’s ambition to launch a stablecoin for its institutional clients.
Per the paper, the firm is eyeing multiple use cases including, tokenized securities, trading digital currencies, and custodial services in partnership with Google (NASDAQ: GOOGL) Cloud. The company is currently planning to launch a multilateral trading facility using digital currencies, building on its previous forays into digital assets.
In 2021, Deutsche Börse became a majority stakeholder in Crypto Finance after acquiring the Web3 firms for $110 million. The company followed the move by acquiring fundsDLT, investing a fortune in tokenization platform 360X after cutting its teeth with the HQLA platform.
Deutsche Börse’s proposed pivot to digital currencies is not entirely novel among stock exchange operators, as its closest competitors have unveiled similar plans. Börse Stuttgart floated its digital asset exchange collaboratively with Japan’s SBI and Alex Springer.
Other traditional finance firms in the U.S., like Fidelity and Citadel Securities, are experimenting with EDX markets in the same mold as digital asset exchanges.
Seeking experts to lead the digitization drive
In early November, the London Stock Exchange Group (NASDAQ:LDNXF) (LSEG) disclosed plans to hire a blockchain expert to lead its foray into novel infrastructure solutions, underlining a growing interest in stock exchange operators pivoting to digital assets.
Per the job listing, the LSEG is searching for a Digital Asset Lead with actionable experience in blockchain, decentralized finance, smart contracts, and traditional finance in line with its forward-thinking objectives.
“The ultimate goal is a global platform that allows participants in all jurisdictions to be able to interact with people in other jurisdictions completely abiding by rules, laws, and regulations, potentially multiple jurisdictions simultaneously, which is something that hasn’t been possible in an analog world, said Murray Roos, LSEG’s head of markets.
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