The solution will provide for a cheaper and more efficient derivative processing across the industry and may go live in early 2018.
Depository Trust & Clearing Corporation (DTCC) entered into a partnership with IBM, Axoni and R3, to develop a distributed ledger framework to drive further improvements in derivatives post-trade lifecycle events, says the company’s press release.
The new platform will be applied at DTCC’s Trade Information Warehouse that automates management for $11 trillion derivatives.
As part of the collaboration, IBM will provide the program management options, Axoni will develop a smart contracts application with R3 acting as a solution advisor. The partners will commence the work in January 2017 and expect to present a tangible result early in 2018. The final product will be submitted to the HyperLedger open source stack. The blockchain resulted from the project will be is a permissioned private ledger.
“The solution will be deployed through a number of phases, with an end-state vision to establish a permissioned distributed ledger network for derivatives, governed by industry-owned DTCC, with peer nodes at participating firms,” the company says.
DTCC is a New York-based corporation performing the functions of a Central Securities Depository as part of the US National Market System. It is considered to be one of the pillars of the US National Market.
R3 blockchain consortium includes about 70 members, with such global financial institutions as the Bank of America, JPMorgan, Credit Suisse, Barclays, Deutsche Bank, HSBC, Morgan Stanley, Citi, Commerzbank, and Societé Generale among them. The consortium was established in 2015 to research and develop blockchain applications for the financial industry.
Axoni offers full stack blockchain solutions for the world’s largest financial institutions and capital market services.