21.finance, a European fintech developing pioneering blockchain-powered digital asset platforms regulated by the European Securities and Markets Authority (ESMA), is building market infrastructure for security tokens on Polygon PoS.
21X will enable smart contract-based trading and settlement of tokenized stocks, bonds, and fund instruments. The order books of 21X operating on Polygon PoS will unlock the full potential of blockchain technology by promoting disintermediation and decentralization in capital markets. The initiative, headquartered in Frankfurt, is currently undergoing regulatory assessment with national and international supervisors.
Tokenized financial instruments, such as stocks, bonds, or funds, are key to unlocking the next wave of institutional adoption of blockchain technology with profound implications for the financial industry. Asset tokenization enables fractional ownership of high-value assets, promotes accessibility to financial instruments, facilitates the tradability of illiquid assets, and automates processes such as reporting, interest payments, and corporate actions.
Until now, the full potential of tokenized securities has been limited by regulatory uncertainty. With the introduction of the EU DLT Pilot Regime (DLTR), Europe has unveiled a harmonized regulatory framework that disrupts the status quo and empowers a transformation of capital markets. 21X is currently in the process of becoming a regulated DLT trading and settlement system under DLTR.
“Fully on-chain exchanges like 21X have a truly disruptive potential for nearly every sector in traditional finance,” said Colin Butler, Global Head of Institutional Capital at Polygon Labs. “21X’s approach, working directly with regulators to build a fully compliant securities trading venue, changes the game."
The Polygon ecosystem has emerged as a tokenization hub, with 21X as the latest in a line of European companies tapping into its low transaction costs, battle-tested security and vanishingly-small carbon footprint. The list of projects includes Taurus streamlining a process for over 25 banks like Credit Suisse and Deutsche Bank, euro-denominated bond tokenization by Siemens, and a digital green bond offering by ABN AMRO.
"With the technical expertise of the Polygon Labs team and the vibrant Polygon ecosystem in asset tokenization, we will enable tradability and liquidity for tokenized securities and foster institutional adoption of the Polygon protocols," said Max J. Heinzle, CEO, and founder of 21.finance.
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