Capital markets News

SocGen security tokens listed on Luxembourg Exchange

luxembourg stock exchange

Today the Luxembourg Stock Exchange announced that three security tokens issued by Societe Generale (SocGen) have been listed on LuxSE SOL. SocGen Forge issued two covered bonds on the Ethereum blockchain in 2019 and 2020, and last year it issued a structured product on Tezos. 

However, the security tokens are not tradeable via the exchange. Today’s announcement is purely a listing to give the securities a higher profile and indicative prices. LuxSE SOL listings are relatively low cost and don’t require substantial disclosure.

“This constitutes yet another significant step towards the digital transformation of the Luxembourg Stock Exchange, and a very first building block in our contribution towards price discovery and transparency of financial instruments issued using DLT,” said Julie Becker, CEO of LuxSE. “

LuxSE was keen to announce it is now open for business for DLT-based security token listings and published some guidelines. In the initial stages, the service is only available for debt securities issued in fiat currency for securities targeting qualified investors or institutions. And the issuer has to have a track record. 

Meanwhile, over the holiday period, SocGen FORGE’s leader Jean-Marc Stenger outlined his vision for security tokens in 2022.

As previously reported, as part of the EU’s digital framework, it introduced draft MiCA legislation for crypto-assets and a DLT pilot regime for security tokens. This allows for a security token sandbox, but the amounts allowed are significant – several billion for some asset classes, unlike other sandboxes. The legislation for the pilot regime is expected to pass by March this year and comes into force nine months later. 

Hence LuxSE is positioning itself as a front runner once the EU pilot regime comes into play. But it’s in for some competition as Switzerland’s SIX Digital Exchange (SDX) is now live.

The stock exchange engaged with blockchain early on. In 2016 one of its subsidiaries, FundsSquare founded FundsDLT, which tokenizes funds for distribution. Other backers include Deutsche Boerse’s Clearstream, Credit Suisse, and Natixis. UBS recently completed a trial.

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