Paxos, a United States-based stablecoin operator, announced Tuesday that it will apply for a formal clearing agency license with the Securities and Exchange Commission, or SEC, in a move that would bring another practical use case for blockchain technology in traditional markets.
As Reuters reported, the pursuit of an agency license by Paxos follows a successful pilot test of its same-day settlement system. Credit Suisse, a Zurich-based financial institution, and Instinet, the trading arm of Nomura Holdings Inc., participated in the pilot by settling U.S.-listed stock trades on the same day.
Paxos says the trades represented the first live application of blockchain technology for U.S. equities. It currently takes two days to settle a trade for equity markets in the U.S. Efforts to shorten this time have gained traction in the wake of the GameStop saga.
Entities must register with the U.S. securities regulator before they operate a clearing house. As the SEC notes:
“Section 17A of the Securities Exchange Act