US SEC Approves BSTX to Conduct Blockchain Settlement in Traditional Markets

Boston Securities Token Exchange (BSTX), a new offshoot of Boston-based BOX Exchange, has received regulatory approval from the U.S. Securities and Exchange Commission (SEC) to operate as a blockchain-based securities exchange.

BSTX, jointly launched by BOX and Overstock’s blockchain division tZERO, initially sought approval for the launch of a publicly traded registered security token. However, the U.S. SEC has approved BSTX to operate as a national stock exchange, enabling it to leverage blockchain technology for faster settlement in traditional markets. According to the US SEC,

“The committee notes that the current proposals on the BSTX Exchange do not address digital token transactions and such proposals, nor any other additional use of blockchain technology.”

While the US SEC has previously refused to allow BSTX to provide encryption services, the latest approval allows the agency to use the BSTX Market Data Blockchain, a proprietary market data real-time update service.

In addition, BSTX will use blockchain technology to help investors experience faster transaction times on the same day (“T+0”) or the next day (“T+1”), instead of the standard two used in traditional markets. Billing cycle for business days ("T+2").

In addition to the regulatory approval of the BSTX-based rule change proposal (SR-BOX-2021-06), the US SEC has also set four conditions for BOX that are consistent with BSTX operations.

These requirements include: participation in all national market system programs related to stock trading, securing a regulatory services agreement with FINRA, being a member of the Intermarket Surveillance Team at the BSTX facility, and applicable governance structures.

According to reports, based on the above developments, the US SEC is also reviewing some high-yield encrypted lending products offered by Gemini, Celsius Network and Voyager Digital.

According to Cointelegraph, the U.S. SEC is investigating whether to consider registering crypto lending services as securities. A Bloomberg report on the matter suggested that the US SEC’s main concern lies in the high-yield products offered by crypto lending services.

Cointelegraph Chinese is a blockchain news information platform, and the information provided only represents the author's personal opinion, has nothing to do with the position of the Cointelegraph Chinese platform, and does not constitute any investment and financial advice. Readers are requested to establish correct currency concepts and investment concepts, and earnestly raise risk awareness.