October 28, 2019 / 8:58 PM / 18 days ago

Paxos to launch settlement of U.S. listed equities after SEC's no-action letter

NEW YORK, Oct 28 (Reuters) - Paxos Trust Co, a New York-based regulated financial institution, said on Monday it will launch a blockchain-based settlement platform for a limited number of U.S. listed equities after the company received a “no-action” letter from the Securities and Exchange Commission.

A no-action letter from the SEC means the U.S. agency will not take any enforcement action against a company for a particular service or product. With a no-action letter, the company can then proceed to offer a specific service or product.

Paxos said this is the first time in half a century that U.S. equities will be settled outside a traditional settlement system. Numerous financial systems have undertaken numerous blockchain-based systems meant to move settlement of securities away from antiquated infrastructure and onto the blockchain. (Reporting by Gertrude Chavez-Dreyfuss; editing by Jonathan Oatis)

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