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DTCC to launch blockchain solution in 2018

By Tim Stewart
2 minute read

US post-trade financial services firm DTCC is currently developing two projects using distributed ledger technology, the first of which is set to go live in 2018.

Speaking to InvestorDaily, DTCC executive director APAC Matthew Chan said the company expects to launch a blockchain version its Trade Information Warehouse platform in 2018.

DTCC is currently working with IBM and US start-ups Axoni and R3 to work on a new trade records system for the global derivatives system.

Separately, the DTCC is working with Digital Asset to compete a proof of concept to better manager the 'netting' process for US Treasury and agency repurchase agreement ('repo') transactions.

The distributed ledger solution for the US repo market would replace the semi-manual processing that currently exists for the US$3 trillion market.

The DTCC and Digital Asset are currently in 'Phase 2' of the project, with the first phase successfully completed in January 2017.

But DTCC executive director of industry relations Tony Freeman noted that the repo market has a very low volume compared to a market like the ASX.

"If there were a lot of transactions it would have been automated a long time ago. It's a small volume, high-value market. You can deal with it on a semi-manual basis," Mr Freeman said.

In fact, one of the unproven features of blockchain technology is whether or not it will function at scale, he said.

Widespread adoption is also vital for the success of any future blockchain solutions, Mr Freeman said.

"We're at a very early stage and adoption is absolutely key. Lots of people want to be the 'lord of the blockchain'," he said.

"There's a phrase which a lot of blockchain advocates use: 'one chain to rule them all'. Everybody wants to be the controller of the blockchain, so interoperability is absolutely key."

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