Borsa Italiana, a member of the London Stock Exchange Group (LSEG), has teamed up with IBM to build a Blockchain platform to help European SMEs digitise and manage shareholder data.
The tool will be designed to issue digital securities for SMEs and simplify the tracking of shareholding information through a distributed shared registry containing a record of all shareholder data.
By replacing the paper trading certificates that are commonly issued to companies today, this should open up new opportunities in trading and investing for both regulators and investors.
“Through our work with IBM on this blockchain solution, Borsa Italiana is taking the lead in transforming the way European SMEs can manage their shareholder data and at the same time expand credit access – all on a trusted digital platform,” said Borsa Italiana CEO Raffaele Jerusalmi.
The key is that the Blockchain-driven process will give all the relent parties increased insight into company information, whilst still ensuring security and encryption.
Private SMEs have traditionally lacked access to public stock exchange networks, but the new platform will give them a link into a broader investor ecosystem, enabling them to set up trading networks and obtain funding.
“Sharing secure and transparent critical network data across shareholder networks is difficult using traditional system,” said Marie Wieck, general manager of IBM Blockchain.
“Blockchain is poised to help remove some of these barriers in traditional methods for the transfer of value – much as the Internet did for the exchange of information in the late 1990s.”
Blockchain is most well known for being the technology behind the digital currency Bitcoin and, although it has significantly grown in prominence in recent years, it’s true potential is yet to be fully realised.
But new use cases are constantly emerging. For example, researchers have proposed using it as the foundation of an anonymous parcel delivery service, while Microsoft has partnered with Accenture to develop a Blockchain-based ID for refugees.