GameStop case pushes securities market toward faster settlement
A blockchain company called tZero, owned by trading site oversight.com Inc., anticipates that innovation will happen with the securities of privately held companies, which don’t trade on public exchanges and face less regulation than the public markets.
“You’re going to see the most innovation in the private space before you’ll see it in the public space,” Alan Konevsky, chief legal officer of tZero, told CQ Roll Call. But even that transition will be “incremental,” he said, heading first to same-day, and then settlement several times a day. His company is working with a regulated exchange, the BOX Exchange LLC, on a securities token exchange offering same-day settlement as an option.
Steven Lofchie, a partner at Cadwalader, Wickersham & Taft LLP, said the settlement issue is much bigger than GameStop. Instead, it is a matter of reducing systemic risk. The longer the…