The Spanish Securities Market Commission (CNMV) has authorized the stablishment of Token City Exchange as an investment firm (Agencia de Valores). This reinforces Token City’s role as a driving force behind the modernization of the Spanish financial market through the tokenization of real-world assets and infrastructures based on blockchain technology.

This authorization comes after several years of regulatory work, tests in the Spanish financial sandbox, and the first fully regulated tokenized transactions in the country, and it opens a new phase: from being primarily a technology provider, Token City will now be able to offer regulated investment services for both traditional and tokenized financial instruments.

What does it mean to be an investment firm in the blockchain era?

An investment firm is authorized and supervised by the CNMV to provide specific investment services. These include, among others, the reception and transmission of client orders, the placement of financial instruments, advisory services and certain ancillary services such as the custody and administration of securities.

In the case of Token City Exchange, the authorization allows us to add to our technology value proposition a set of regulated activities directly connected to tokenized markets:

• Placement of tokenized financial instruments in primary issuances.
• Custody and registry of financial instruments based on blockchain through the ERIR function (Entity Responsible for Registration and Recordkeeping).
• Management of a Trading and Settlement System for secondary trading.
• Reception and transmission of investor orders.
• Investment advice on the instruments traded.

These services can be provided in relation to a broad range of tokenized financial instruments, with full legal certainty.

The ERIR and regulated native tokenization

The ERIR is responsible for the registration and recordkeeping of negotiable securities natively represented through systems based on blockchain. Only entities already authorized to safeguard securities may perform this role, and their mission is to ensure the integrity of issuances, proper maintenance of the registry, and the identification of the holders of rights over the securities.

With its Token City Exchange investment firm, the company is no longer just the “technology engine” behind tokenized issuances and will now directly assume intermediation and registry functions, to which we will add, within a single infrastructure, the trading and settlement of tokenized securities.

All of this will take its final form with the launch in 2026 of Token City’s tokenized exchange, allowing us to provide services across the entire value chain, covering the full lifecycle of the asset and placing us among a select group of companies worldwide with this capability.

From the sandbox to the DLT Trading & Settlement System

The authorization to incorporate Token City Exchange as an investment firm comes after the regulatory sandbox project that we developed together with the CNMV. The sandbox allowed us to test our market infrastructure based on blockchain, using tokenized electronic money as a means of payment and validating key functionalities such as wallet opening, dividend payments and the ERIR function.

Token City’s Trading and Settlement System will provide direct, global access to institutional and retail investors, with near-instant settlement and a more efficient cost structure than traditional systems.

Our model, recognized by ESMA and other European supervisors within the DLT Pilot Regime, integrates in a single infrastructure the typical functions of a multilateral trading system and a securities settlement system, leveraging blockchain technology’s ability to record and settle transactions in one unified environment.

A key building block for Europe’s tokenized markets

Although estimates differ as to timing, all projections coming from the financial industry converge on the view that a significant share of global GDP will eventually flow through blockchain infrastructure. That transition calls for initiatives like Token City’s, combining the power of tokenization with top-tier regulatory capabilities.

This is why the authorization to incorporate Token City Exchange as an investment firm and the upcoming launch of our tokenized securities exchange are so important. We are building European infrastructure that combines regulation, technology and hands-on experience in tokenization, so that companies and investors can operate in the new tokenized economy with the same guarantees as in traditional markets.

In the words of our CEO: “Thanks to our clients and investors, we have achieved this new milestone.” The next chapter will be the roll-out of our tokenized securities exchange and the continued build-out of the infrastructure that is already transforming how we create, distribute and trade value in the 21st-century economy.