Four Banks, DTCC, Markit Complete Blockchain Test for CDS
Bank of America Merrill Lynch, Citi, Credit Suisse and JPMorgan were all part of project.
![shutterstock-213521062 shutterstock-213521062](/sites/default/files/styles/landscape_750_463/public/import/IMG/728/344728/shutterstock-213521062-580x358.jpeg.webp?itok=Zgzbw21S)
Bank of America Merrill Lynch, Citi, Credit Suisse and JPMorgan participated in the multi-month project that looked to demonstrate that payments, amendments, novations and compressions can all be managed via the blockchain on a permissioned, distributed, peer-to-peer network.
The experiment conducted 85 structured test cases to check lifecycle functionality, integration with external systems, network resiliency and data privacy. There was a 100-percent success rate across all tests.
"It's a pleasure to be part of such a tremendous step forward," says Axoni CEO Greg Schvey. "The participants in this project can catalyze true progress in this space, having consistently demonstrated the motivation and technical sophistication necessary to tackle the speed, scale, and complexity of this undertaking."
Process
The group of firms created a blockchain trade processing network with a combination of hosted and internal deployments of Axoni software. CDS transactions were chosen because of their multiple lifecycle events and the efficiency benchmark established by the DTCC Trade Information Warehouse (TIW), a post-trade asset servicing of credit derivatives.
Markit created smart contracts from CDS trade confirmations sourced via MarkitSERV. Economic terms and computational logic for managing permissions and event processing were embedded within the smart contracts. Blockchain's transparency was also on display, as trade details, counterparty risk metrics and systemic exposure to each reference entity could be made available to regulators in real time.
"Our experiments with Axoni demonstrate that confidentiality and privacy can be preserved between bilateral parties on an immutable distributed ledger at scale," says Emmanuel Aidoo, leader of blockchain and distributed ledger function at Credit Suisse.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@waterstechnology.com or view our subscription options here: http://subscriptions.waterstechnology.com/subscribe
You are currently unable to print this content. Please contact info@waterstechnology.com to find out more.
You are currently unable to copy this content. Please contact info@waterstechnology.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@waterstechnology.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@waterstechnology.com
More on Emerging Technologies
This Week: Startup Skyfire launches payment network for AI agents; State Street; SteelEye and more
A summary of the latest financial technology news.
Waters Wavelength Podcast: Standard Chartered’s Brian O’Neill
Brian O’Neill from Standard Chartered joins the podcast to discuss cloud strategy, costs, and resiliency.
SS&C builds data mesh to unite acquired platforms
The vendor is using GenAI and APIs as part of the ongoing project.
Chevron’s absence leaves questions for elusive AI regulation in US
The US Supreme Court’s decision to overturn the Chevron deference presents unique considerations for potential AI rules.
Reading the bones: Citi, BNY, Morgan Stanley invest in AI, alt data, & private markets
Investment arms at large US banks are taken with emerging technologies such as generative AI, alternative and unstructured data, and private markets as they look to partner with, acquire, and invest in leading startups.
Startup helps buy-side firms retain ‘control’ over analytics
ExeQution Analytics provides a structured and flexible analytics framework based on the q programming language that can be integrated with kdb+ platforms.
The IMD Wrap: With Bloomberg’s headset app, you’ll never look at data the same way again
Max recently wrote about new developments being added to Bloomberg Pro for Vision. Today he gives a more personal perspective on the new technology.
LSEG unveils Workspace Teams, other products of Microsoft deal
The exchange revealed new developments in the ongoing Workspace/Teams collaboration as it works with Big Tech to improve trader workflows.