One of the world's largest investment funds, Vanguard, which manages assets with a total value of $5.7 trillion, announced the successful launch of a pilot project to use blockchain in the settlement of securities transactions.

Vanguard Investment Fund, in partnership with Symbiont, a technology solutions company, announced they successfully completed the first phase of a blockchain pilot designed to digitize the issuance of asset-backed securities (ABS). The partners in the project were also the banks BNY Mellon, Citi and State Street.

The initiative aims to simulate the full cycle of securities settlements using distributed ledger technology (DLT).

“Vanguard is dedicated to providing innovative, world-class solutions that help advance the financial services industry," said Warren Pennington, principal and head of Vanguard's Investment Management FinTech Strategies Group. "By digitizing and streamlining the ABS issuance process, we will be able to increase the speed and transparency of transactions while reducing costs and minimizing exposure to risk, which ultimately leads to a more efficient business model for future generations of capital market activity.”

Vanguard and Symbiont plan to use the distributed ledger technology and smart contracts to improve the securitization of asset-backed securities issues. The introduction of these technologies and solutions will expand the flow of information, improve the pricing process and liquidity indicators in the secondary market, as well as automate key corporate actions through the use of a common infrastructure that is open to all market participants.

Vanguard is one of the largest investment management companies in the world. As of April 30, 2020, Vanguard managed $5.7 trillion in global assets and is working with more than 30 million investors from around the world.

Symbiont is a fintech company creating an infrastructure of financial markets using blockchain technology. Assembly is a corporate blockchain platform from Symbiont, designed to simplify the process of coordination and data exchange in real time while maintaining complete confidentiality. Symbiont works with financial companies, including Citi, Nasdaq, Ranieri, Templum and Vanguard.