First tokenized asset under new blockchain law launched in Switzerland
Sygnum Bank and Fine Wine Capital AG have issued the first tokenized asset under the new Swiss DLT law, the “Fine Wine” token.
Two Swiss firms just launched the first tokenized asset under the country’s new blockchain law. New legal provisions on distributed ledger technology took effect on Monday, February 1, the same day when the token was launched.
Sygnum Bank and Fine Wine Capital AG have issued the first tokenized asset under the new Swiss DLT law, the two firms said in an announcement. Called the “Fine Wine” token, it is the first in a new category of ledger-based securities recognized under the new law.
The new asset was tokenized through Desygnate, Sygnum’s tokenized trading platform, according to Bitcoin.com. The token, which is backed by collectible premium wine, is available for Sygnum clients under the “Art & Collectibles” category.
With the new legislation in place, investor demand for tokenized luxury goods such as fine wines, art, and diamonds is expected to increase. “Tokenization of wine assets enables us to expand our private collector investor base to new private and institutional investors,” Fine Wine co-founder Alexandre Challand said, according to Coindesk. “This provides them the opportunity to hold, trade, or request a physical settlement of this unique asset in an efficient manner.”
The new DLT regulation means that the digital assets are now fully recognized by the Swiss legal system. “The legal provisions which come into effect today ensure that asset tokenization is now a viable alternative to traditional securitization from a legal point of view,” Gino Wirthensohn, Sygnum Bank’s Head of RegTech, said. “At Sygnum, we have developed a framework which allows us to efficiently issue our clients’ asset tokens under the new legal framework.”
Tokenization makes it easier to keep track of assets as their legal ownership is automatically transferred to the new investor via a blockchain platform. “Previously, you had uncertificated rights there that had to be assigned, and a lot of smart people were looking at how that could be done on-chain,” said Alexander Vogel, a partner at the law firm Meyerlustenberger Lachenal (MLL). “With these new registered rights, it’s clear that you have legal certainty. If they are properly transferred on a blockchain, the new owner who holds them in his or her wallet is definitely the owner of these rights.”