Stuttgart Stock Exchange Uses Blockchain to Hasten Securities Settlement

Boerse Stuttgart Group successfully tested blockchain to reduce securities settlement time from two days to a few minutes.

Boerse Stuttgart Group, the second largest stock exchange in Germany and one of the biggest in Europe, successfully tested the settlement of tokenized securities transactions in cooperation with the European Central Bank (ECB).

The initiative was aimed at exploring the digitalization of the European capital market. As part of the tests, transaction settlement time was reduced from two days to a few minutes. Blockchain solutions allowed transactions to be processed automatically and directly between counterparties, eliminating intermediary risks.

The trials were conducted with five types of tokenized assets, including bonds, exchange-traded funds, and equities. The wide range of scenarios explored demonstrated the potential of using blockchain to provide stable and secure settlement in both standard and emergency environments. The tests were done together with six leading German banks, namely:

• Commerzbank;
• Deutsche Bank;
• DZ BANK;
• Landesbank Baden-Württemberg (LBBW);
• Bankhaus Metzler;
• V-Bank.

According to Matthias Voelkel, CEO of Boerse Stuttgart Group, blockchain is revolutionizing the capital market in Europe, and the company will continue to implement DLT systems. In particular, an exchange for tokenized assets will be launched in Switzerland this year, with blockchain being used for settlement.

Blockchain developments of Boerse Stuttgart were recently used by DZ BANK to launch crypto trading and custody services, which were accessed by more than 700 German banks.

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