Paxos Receives “No-Action” Letter from SEC to Settle Blockchain-based Equities

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Paxos is planning to streamline equities settlement by using a regulatory compliant blockchain-based process. The Paxos Trust Company received a no-action relief letter from the US Securities and Exchange Commission (SEC) on October 28, in order to conduct equity securities trading on a blockchain-enabled platform designed specifically for broker-dealers. Paxos’s management revealed that Credit Suisse and Société Générale would be the first organizations to use the new Paxos settlement service, which will run on a private (permissioned) distributed ledger technology (DLT)-based network. The service will allow two different parties to bilaterally conduct securities trading with each other. Notably, the announcement marks the first regulated blockchain platform for settling these types of trades, which will be significantly more efficient than using legacy systems. Paxos’ developers have been working on the newly introduced service for over two years, according to Melayna Ingram, Paxos’ head of securities products and the product director for…

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