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SEC Delays its Approval for Boston Security Token Exchange proposed by tZERO and Box Digital Markets
Apr, 03 2020
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By releasing a letter on April 1, The
United Security and Exchange Commission has revealed that it seeks more time to
get more feedback before approving the launch of the Boston Security Token
Exchange (BSTX).
The order has been released owing to the
rule change to BSTX’s original filing.
The proposed BSTX Exchange
Boston Security Token Exchange (BSTX) has
jointly been proposed by Box Digital Markets and Overstock’s Blockchain
subsidiary tZERO. It will be launched as a platform for regulated security
tokens.
States Securities and Exchange Commission
is seeking more feedback and more time before it decides whether to approve the
launch of the Boston Security Token Exchange (BSTX).
The project seeks operations using:
“A fully automated price-time execution
system to list and trade NMS stocks that meets BSTX listing standards and for
which ancillary records of ownership reflecting certain reflecting the certain
end of the day security token balances as reported by market participants would
be created and maintained using distributed ledger technology.”
The SEC also has mentioned two feedbacks
which it received earlier this year on the BSTX proposal and the subsequent alterations
applied by Box and tZERO.
The comments letters have pointed out their
concern that the proposed platform could represent a significant change for
equity markets. One of the comment letters mentioned the 85% drop in the value
of the token in the last two years after its issuance and asked revaluation of
the proposal. One of the feedback also has alleged that the proposal has
insufficient details about its infrastructure and technological alliance with
the existing equities market infrastructure.
To revive these concerns, the SEC has asked
for more time to evaluate. It also wants to check whether the proposal aligns
with the Securities Act of 1934.
The contributors have been given three more
weeks to submit their concerns and the SEC will take two more weeks to respond
to the comments.
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Jayashree Ingle
CBW - External Analyst
INDIA
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