Swarm launches tradable stocks and bonds on chain
Swarm claims world-first DeFi-compatible securities with the fully asset-backed tokens are available on the Polygon blockchain for both retail and institutional investors, with no minimum investment.
February 21, 2023 - Swarm, the regulated blockchain platform, announced the launch of a claimed world-first public investment offering for AAPL. TSLA, and two US Treasury Bond ETFs on-chain.
Trading is available from Thursday 23rd February, 24/7 and compliant under German regulation on Swarm's permissioned DeFi platform.
Swarm claims this is the first service of its kind for investors looking to access real world assets using digital blockchain technology, while meeting full regulatory requirements to provide complete confidence to users.
Hedge funds and institutional investors can now access stable and secure global markets 24/7 through Swarm. For those already on-chain, including stablecoin issuers and treasury managers, it means they have less volatile assets to deploy into without needing to leave the DeFi ecosystem.
The token offering initially includes AAPL and TSLA stock, iShares US treasury bond 0-1 year ETF and iShares US treasury bond 1-3 year ETF. Swarm will add more stocks and real world assets in the future.
Timo Lehes, co-founder of Swarm, commented: "Swarm is the first entity to offer and trade tokenized T-bills and stocks via a regulated and decentralized platform. We operate within the German regulatory environment, meaning we can issue and trade real world assets on blockchain, unlike any other entity.
"We have started with stocks and bonds, and will soon extend this to any asset that needs to be traded on a regulated platform, from carbon credits to real estate or private holdings. To date, traditional market participants have not had a comprehensive and regulatory compliant solution for issuing and trading real world assets on-chain.
"The FTX and Celsius crises last year only highlighted key structural and regulatory weaknesses in the market, demonstrating that crypto collateral is too highly correlated and easy to manipulate. Regulation, in the right parts of the ecosystem, is critical while decentralization enhances the transparency required to build trust."
Swarm does not take custody of the asset-backed tokens, which are controlled by battle-tested code. They can be added to liquidity pools to earn yield, or kept in investors' own Web3 wallets.
The ISIN-based tokens benefit from the trust and stability of traditional markets plus the flexibility and greater access to global liquidity, at lower cost, on the blockchain. Stock and bond certificate tokens are integrated with traditional financial markets and can be redeemed for the value of underlying real world asset.
Lehes adds: "Today's announcement is significant for both DeFi and TradFi. There is clear demand for high quality assets to become available on-chain. Institutional participants will now be able to deploy assets from traditional markets via blockchain through Swarm.
"Swarm is a hybrid platform, combining the depth of liquidity and value of traditional financial markets with the advantages of blockchain technology. We are the only trusted platform that institutions with a fiduciary responsibility can use to issue, trade and manage quality collateral on-chain with confidence and in a decentralized way."
The tokens are issued by SwarmX GmbH, a wholly owned subsidiary of Swarm Markets GmbH, under a prospectus registered with the Financial Market Authority in Liechtenstein and passported into Germany. Secondary trading activities are regulated by Germany's Federal Financial Supervisory Authority (BaFin), and can be accessed on Swarm's permissioned DeFi platform.
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