The Swiss stock exchange has set the gold standard for innovation and dynamism in the financial services industry for a long time. Its disruptive journey which includes trailblazing initiatives such as establishing Switzerland’s first ever CSD and opening the world’s first fully electronic exchange is set to reach the next level. Cementing its forward-thinking credentials, SIX – the operator of the Swiss stock exchange – is looking to completely transform existing securities markets by facilitating the issuance and trading of digital assets, along with the tokenisation of existing securities and non-bankable instruments through SDX, the new Digital Exchange.
A Revolution in Trading
As its history illustrates, the Swiss stock exchange has led where others have followed. It has a long track record of being a pioneer in electronic trading and automation. Beginning in the mid-1990s, the then SWX started to support electronic trading in foreign and domestic equities, along with Swiss options. In 1996, SWX made another leap by launching a fully automated trading, clearing and settlement system as the transition away from manual processes started to acquire greater momentum. It then followed this milestone up by launching SWX Repo, the world’s first electronic repo trading platform.
Forging the Path for ETFs
The Swiss stock exchange was one of the first European exchanges to spot the potential of ETFs (exchange traded funds) almost two decades ago. The listing of the first ETF in 2000 marked the start of an exceptional success story. Ever since, it has strengthened its position as a leading ETF destination with one of Europe’s largest product offerings of over 1,500 ETFs. Its annual trading volumes have continued to rise and established themselves above CHF 100 billion. A decade after the first ETF was traded, the Swiss stock exchange launched a segment for ETPs (exchange traded products); today, it is the world’s leading exchange for ETPs on crypto-currencies, both in terms of listed products and trading volumes.
Automated Value
As a leading CSD, the Swiss stock exchange has played an instrumental role in tackling a number of industry issues, including developing solutions to enrich clients’ trades with SSIs to automate settlement instructions. Elsewhere, its xChain is an online, transparent and collaborative information platform dedicated exclusively to corporate actions, which has proven exceptionally useful for end customers. Conscious of the rapidly evolving risks facing clients, SIX also launched its Security Operations Centre which leverages cognitive computing to help manage cyber- threats.
The Beginning of a New Era
With SDX, SIX is looking to once again reshape securities markets by providing the infrastructure to support the issuance and trading of digital assets, along with the tokenisation of existing securities and non-bankable instruments. SDX is expected to generate a huge liquidity boost for financial markets as initial digital offerings (IDOs) – namely digital listings that take place on a distributed ledger – will provide more companies with easier access to public markets, in what could prove to be yet another industry game changer initiated by the operator of the Swiss stock exchange.