Berlin's Swarm launches Open dOTC, a groundbreaking DeFi platform. Regulated by Germany's BaFin, it facilitates trading in tokenised real-world assets.
Open dOTC, built on Ethereum, uses innovative dOTC smart contracts. These contracts aim for zero slippage, instant settlement, and reduced risks, all with full collateral.
At launch, Swarm offers tokenised U.S. treasury bond ETFs. Plans are afoot to include tokenised stocks like Apple and Tesla.
Swarm's co-founder, Timo Lehes, emphasises the need for viable trading platforms for tokenised assets. Open dOTC's debut, he notes, opens doors for more people to engage with the 2023 RWA narrative.
However, the Association for Financial Markets in Europe voices concerns about DeFi's exclusion from MiCA.
Open dOTC ensures compliance with EU prospectus regulation in Liechtenstein. It requires KYC and AML checks but allows free token transfers between wallets.
Swarm confirms the continuation of its permission, regulated DeFi trading platform. Co-founder Philipp Pieper highlights Swarm's regulatory experience and commitment to the DeFi community's ethos.
Open dOTC's trading fees, set at 0.25%, support the buy and burn of Swarm's SMT tokens.
Lehes sees this as making Open dOTC a community-owned project, in effect, due to the reduction in SMT supply. Yet, there's no formal community ownership or governance program, preserving its public goods service nature.
Image: The Block
Swarm's Open dOTC platform represents a significant advancement in the DeFi space, particularly in tokenising real-world assets. It offers a more accessible and efficient trading environment.
The platform's compliance with EU regulations and its integration of KYC and AML checks reflect a careful balance between innovation and regulatory adherence.
However, the absence of a formal governance structure for the platform raises questions about the long-term community engagement and control.
Overall, Open dOTC's launch is a promising step towards the wider adoption of DeFi and the tokenisation of assets, potentially heralding a new era in financial markets.
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