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General Published on: Fri Feb 10 2023

Capital Markets and How Software is Changing Transactions

Capital markets are where the major players throughout the world come to buy and sell various products. You can find nearly anything you want in the capital markets. Such a robust marketplace certainly requires strong software to support the many facets of the industry. That is why capital markets software products are in huge demand and gaining tremendous traction.

Security also is at the top of the list. We’ve seen many companies lose trust within the marketplace for various data breaches. While it’s nearly impossible to be 100% protected, your firm can continue being proactive with security with capital markets software. One of the newest trends to hit the marketplace is a security token offering.

Yes, it sounds similar to an initial public offering or initial coin offering but let us explain.

According to Mindtree.com, an STO is a process where an investor exchanges money for a security token representing their investment. Similar to Bitcoin, this offers a level of security that’s difficult to penetrate. This particular token will be issued every time an investment purchase is made, and the token will be unique and never duplicated. The tokens are then stored on a ledger and the transaction will settle.

This sounds a lot like Bitcoin and that’s because Bitcoin has opened a new door into how finance and the capital markets can better protect the participants. Blockchain has enabled new methodologies for transacting that could eventually replace our current transaction system.

Some of the benefits of using the STO include 24/7 trading. Currently, our markets, with the exception of cryptocurrency, have end times where market participants are unable to place trades. With markets being open 24/7, this offers more opportunity to place trades and capitalize on market movements.

Another benefit is security. With having an encrypted trade, it’s protected from would-be hackers or people trying to spy on your investments. 

What this means for you and your firm is that technology is changing and your firm must be in a place that accepts change. These capital market software solutions may be new, but they look to build and replace existing technologies, requiring your firm to update outdated procedures. You can look at the larger investment firms such as Goldman Sachs, which continue to internally test blockchain technology to help expedite transactions while ensuring top-notch security.

Now you certainly don’t have to look far to see how technology impacts your business. You can look at something close to home, such as reporting software. This changes every few years, offering better ways to provide data to your clients and decision-makers within your firm. 

If your firm is looking at upgrading technologies, take a look into our services here at Hexaview. We are a leading Fintech Software development company that is renowned for its capital market software solutions, lending software solutionswealth management software solutions, and much more. We’d be happy to work with your firm and explore new opportunities, bringing efficiencies and ultimately saving you money. Feel free to reach out if you have any questions.