Russia’s National Settlement Depository (NSD) is planning to launch its digital asset ledger next month, 5,000 kilometers away from the institution’s Moscow headquarters, as reported by CoinDesk.
As per the publishing, the Moscow Exchange Group subsidiary opted for Switzerland to incorporate D3ledger (Decentralized Digital Depository), a project that’s been in the works since 2017. The head of innovation and a director at NSD, Artem Duvanov stated the reason behind choosing Switzerland is the city’s congenial regulatory environment and potential for market-making in digital assets.
Duvanov told the publishing:
“In terms of laws, [Switzerland] allows the tokenization of at least some kind of securities. That’s the first thing. And it’s favorable for such things because there is market demand.”
Reportedly, the launch in June will also incorporate plans to track ownership of several assets i.e. a security token representing unregistered shares in a small healthcare company. Covering a range of cryptocurrencies from the two by market capitalization, bitcoin, and ether to sora, a cryptocurrency developed by Japanese tech provider Soramitu.
However, in the case of bitcoin, and ethereum the assets will be depository notes similar to the depository receipts for foreign company stocks traded on U.S. exchanges. Duvanov added :
“When you say you have some bitcoins in our platform. You actually have some depository receipts for bitcoins which are held by D3ledger platform.”
This will involve “freezing” bitcoins and ethereum tokens on the public networks and employ a multi-signature smart contract, later issuing rights to the tokens on the D3ledger network. The D3ledger network was built using Hyperledger Iroha, an implementation contributed to the Hyperledger consortium by Soramitsu. Duvanov said:
“The idea behind D3ledger is a combination of the public network and a private network; slow public network and fast private network. This method of holding them is distributed so there is no custody risk like if you store your bitcoins on an exchange.”
As per Duvanov, the next step is to add a reputable stablecoin to D3ledger in order to allow over-the-counter (OTC) crypto transactions without counterparty risk and delivery-versus-payment of securities trades, meaning both sides of a trade are completed simultaneously. He stated:
“We will include an established connection with some stablecoin, like Gemini coin or some coin backed by dollar or euro.”
Competition With SDX
The Swiss national stock exchange group, SIX is reportedly working on creating its own “stablecoin,” a cryptocurrency pegged to the Swiss franc in order to facilitate transactions on the SIX Digital Exchange (SDX), as reported by CoinDesk.
The firm did not provide any further detail about the new token, whether the Swiss franc-backed coins would be for private use within SDX (like JPMorgan Chase’s feted JPM Coin) or will it be added to the cryptocurrency ecosystem. Within SDX, a fiat-backed token could purportedly be used to perform tasks such as atomic swaps of tokenized securities and other assets on the blockchain.