Financial Services Giant DTCC Brings Blockchain Post-Trade Platform in Test Phase
Fifteen multinational banks have joined a project to trial DLT solutions for the settlement of credit derivatives.
American company Depository Trust and Clearing Corporation (DTCC), one of the leading global financial services providers, has teamed up with fifteen multinational banks to move its blockchain-based post-trade platform from a research to a closed testing phase. In a press release on Tuesday, DTCC announced only British Barclays bank by name while other fourteen institutions remained undisclosed. MarkitSERV, a provider of over-the-counter (OTC) infrastructure, also joined the trial.
DTCC began the blockchain project more than a year ago with the aim to analyze how distributed ledger technology (DLT) and cloud services can improve its credit derivatives Trade Information Warehouse (TIW) system. Initially, DTCC selected only three partners, IBM, Axioni and R3 with IBM providing program management, DLT know-how, and integration services, and R3 serving as an advisor of the project. The DLT initiative uses the blockchain technology of Axoni.
After eighteen months of research, DTCC decided to bring the project in the so-called closed trial.
“In this phase, 15 of the world’s largest global banks are conducting end-to-end, structured user acceptance tests, leveraging simulated use cases and test data and validating the interaction between systems, firms and other key market infrastructure providers, including MarkitSERV and its new platform for credit, TradeServ,” DTCC explained in the statement.
“Upon successful completion, DTCC expects to move to an “open” testing phase by the end of the year, when other market participants and service providers will have the opportunity to test.”
DTCC plans to move Trade Information Warehouse to blockchain and cloud infrastructure after the first quarter of next year. TWI provides post-trade services for bilateral credit derivatives by performing payment calculations, lifecycle events and settlement through CLS Group. Moving the system to a DLT can improve data recording with common standards and governance practices, which would enable companies to follow various regulatory rules more easily, DTCC explained.