Tel Aviv Stock Exchange explores trading until 11 p.m. and blockchain-based securities
Two new joint working groups will examine extending trading hours and introducing tokenization to Israel’s capital markets. The first phase could include stocks, bonds and ETFs, while the second will explore blockchain infrastructure for issuing, trading and settling securities.
The Israel Securities Authority and the Tel Aviv Stock Exchange announced Tuesday the establishment of two joint working groups to examine expanding trading hours in Israel, including the introduction of a late trading session, or “after-hours” trading, as well as the use of tokenization for securities.
The first working group will examine a trading session between 5:30 p.m. and 11 p.m., following the end of the regular trading day. In the initial phase, the group will examine trading in stocks and bonds, including dual-listed stocks and ETFs tracking international indices, securities that may be affected by company reports, macroeconomic data and trading in major global markets, particularly the U.S. market, after the close of trading in Tel Aviv.
Under the initial outline, after-hours trading would take place in a dedicated and separate trading environment and would begin as close as possible to the end of regular trading. The possibility of expanding the session to additional financial instruments, including derivatives, would be examined at a later stage.
The second working group will focus on tokenization, the representation of a security or the rights associated with it through a secure digital record, or token, on blockchain-based infrastructure.
According to the Securities Authority and the Tel Aviv Stock Exchange, the models being examined would not change the underlying assets or investors’ rights, nor would they alter existing requirements for disclosure, supervision or investor protection. Instead, the change would be to the infrastructure used to register, issue, trade and settle the securities.
Among the potential advantages cited by the Authority and the exchange are faster and more secure settlement through the atomic transfer of an asset and its corresponding payment, the use of smart contracts to automate corporate actions and interest payments, and the creation of new distribution channels for financial assets.
