Montis Group today confirmed its intention to apply for entry into the Bank of England (BoE) Digital Securities Sandbox (DSS), a significant initiative unveiled earlier yesterday by the UK central bank and the Financial Conduct Authority (FCA). The DSS is designed to promote innovation in digital securities, and it operates under the legal framework set out by the Financial Services and Markets Act 2023.
Montis Group is the digital Financial Markets Infrastructure (dFMI) subsidiary of Archax, the first-ever FCA-regulated digital securities exchange, broker, and custodian. The group is leveraging the Minimum Viable Product (MVP) it has developed for its full-scope Central Securities Depository (CSD) application in Luxembourg. Montis plans to use distributed ledger technology (DLT) for the issuance and settlement of digital securities under the temporary, modified UK legal and regulatory framework provided by the DSS.
Martin Watkins, CEO of Montis Group, expressed strong support for the DSS initiative, stating:
"We have spent over three years developing our digital CSD services for Europe and are very supportive of the UK DSS. Our ambition is to enhance our Luxembourg-based full-scope CSD infrastructure with on-chain cash services for the UK markets, alongside upstream and downstream innovations that will drive efficiency and accelerated adoption."
Watkins further highlighted the advanced capabilities Montis has already developed, noting:
"We are currently able to record and aggregate both conventional and natively digital securities using DLT in Luxembourg. By bringing this functionality to UK capital markets, we aim to deliver increased access to digital securities tokens and intend for our Montis DSD to be supervised as a full-scope CSD in the UK, so that we can provide seamless links globally to other CSDs."
Montis Group’s planned participation in the DSS represents a strategic step in the UK’s ambition to lead the global digital securities market. By leveraging DLT, Montis seeks to provide innovative and secure post-trade infrastructure, enhancing the efficiency of digital securities settlement and custody.
As the dFMI subsidiary of Archax, the Montis DSD benefits from the regulatory expertise and pioneering position that Archax holds within the UK market. Archax, as the first FCA-regulated digital securities exchange, has established itself as a trusted player, bridging the gap between traditional financial markets and the fast-evolving world of digital assets.
The introduction of the DSS by the Bank of England and the FCA marks a significant milestone for the UK’s financial sector, and Montis Group is well-positioned to be a key participant in this evolving landscape. By utilizing its proven digital CSD capabilities, Montis is committed to contributing to the UK’s digital securities infrastructure, ensuring the global financial centre remains at the forefront of financial innovation.
