Capital markets News

ODX’s START, Japan’s market for security tokens to expand beyond real estate

odx osaka digital exchange start

Last Christmas day, the Osaka Digital Exchange (ODX) launched the START secondary market for tokenized securities. Founded by SBI, backers include Daiwa Securities, Nomura, SMBC and the CBOE. Japan has a reasonable amount of institutional tokenization activity, mainly around real estate. START plans to support security tokens for other asset classes, including aircraft, ships and renewable energy assets.

Trading has been muted as might be expected for a novel marketplace, and only two digital securities were available at launch. During the first month there were 110 transactions for a total of JPY 11 million ($73,600).

The securities firms involved with the first tokens were SBI Securities and Daiwa Securities. Nomura Securities and SMBC Nikko Securities are expected to join the platform this year. Others have also approached the trading platform.

Additionally, ODX launched the START Operations Committee, which includes members from token issuers, trust banks, blockchain platforms (such as BOOSTRY and Progmat) and securities firms.

While there are a handful of digital securities secondary markets worldwide, most were created by startups rather than incumbents, as is the case here. Examples of secondary marketplaces include SecuritizeADDXFigureINX, and tZERO. Amongst incumbents, SIX launched the SIX Digital Exchange (SDX) in Switzerland.

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