Switzerland built the legal and market infrastructure for tokenized securities before most jurisdictions understood what was needed. Here is where that effort has led, and what it means for issuers and investors today.

The word "tokenization" has attracted more hype than almost any other concept in financial technology. It has also, in Switzerland at least, attracted serious regulatory and institutional investment. While other jurisdictions were still debating whether blockchain-based securities had any legal standing, Switzerland amended its core financial legislation, licensed the infrastructure to support them, and began executing real transactions. The framework is no longer theoretical. It is operational.

The foundation is the DLT Blanket Act, which came into force in 2021. Rather than creating an entirely new regulatory regime, Swiss lawmakers took the pragmatic approach of amending existing legislation to accommodate distributed ledger technology within the established legal framework. The most significant change was the introduction of a new category of asset called ledger-based securities. These are tokenized instruments whose ownership rights are transferred automatically and conclusively via the blockchain when a transaction is recorded. The legal certainty this creates is meaningful: the holder of a ledger-based security on a recognised DLT platform is, unambiguously, the legal owner. There is no parallel paper register, no gap between economic and legal ownership, and no dependence on an intermediary to confirm the transfer.

The market infrastructure built on this foundation is the SIX Digital Exchange, known as SDX. Licensed by FINMA as both a stock exchange and a central securities depository, SDX operates a DLT-based platform for the issuance, trading, settlement, and custody of digital securities. From a legal standpoint, a digital bond issued on SDX is identical to a traditional bond. The "digital" element refers to the DLT backbone, not to any difference in legal treatment or investor rights. From June 2025, digital bonds issued on SDX trade directly on SIX Swiss Exchange through a live operational link between the two platforms, which means tokenized instruments now sit within the same trading and settlement infrastructure as any other listed security. BX Digital, the DLT trading venue operated under BX Swiss, received its FINMA licence in 2025, adding a second regulated venue for tokenized securities trading in Switzerland.

The asset classes being tokenized have expanded well beyond the bond pilots of the early years. Real estate, private equity, private credit, and commodities are all active areas of development. The logic is consistent across each of them: assets that are illiquid, large in minimum ticket size, difficult to transfer, and expensive to administer in traditional form become more accessible, more divisible, and more efficiently managed when represented as a token on a regulated platform. Citi and SDX announced a partnership in 2025 to tokenize late-stage pre-IPO private company shares, making them accessible to institutional investors through SDX's CSD infrastructure. The Swiss National Bank's Project Helvetia demonstrated settlement of tokenized assets in wholesale central bank digital currency. These are not proofs of concept. They are production-grade collaborations between institutions that have been doing this at scale for decades.

For issuers, the practical implications are significant. A company seeking to raise capital through a tokenized bond or note can issue directly onto a DLT platform with a formally recognised security identifier, secondary market access through a regulated exchange, and settlement in a matter of minutes rather than the two-day cycle of traditional securities. The cost and complexity of maintaining a register, managing transfers, and administering coupon payments are substantially reduced. For investors, fractional ownership, programmable distributions, and access to asset classes that were previously only available to large institutions at high minimum ticket sizes are the tangible benefits.

ISP is actively developing its capabilities in tokenized securities structuring and issuance, working within the Swiss DLT framework to bring structured products and capital markets instruments to market in tokenized form. As this market continues to develop, the same discipline that ISP applies to AMCs, ETPs, and CLNs, covering legal structure, investor protection, and compliant custody, applies directly to tokenized issuance. To discuss how tokenization might be relevant to a specific transaction or product structure, speak to Tom Rieder at ISP Group or read more about tokenization and ISP's broader issuance capabilities.