With 7,000 securities now digitised on Clearstream’s DLT-based issuance platform “D7”, Indian debentures issued digitally, and Chilean bonds coming up, it could be time to revise the understanding that blockchain developments in the securities area have got all stuck. A panel at PostTrade 360° Amsterdam took a snapshot of where the digital-asset ecosystem is at, as 2023 is ending, and what it is promising for the possibilities of tapping liquidity pools in new ways.
The session was sponsored by Broadridge.
On the panel:
Horacio Barakat, Head of Digital Innovation for Capital Markets, Broadridge,
Colin Parry, Chief Executive Officer, ISSA – International Securities Services Association,
Amar Amlani, Head of EMEA Digital Assets, Goldman Sachs, and
Thilo Derenbach, Head of Sales & Business Development, Digital Securities Services, Clearstream,
… in discussion moderated by Ricky Maloney, Director, Davies Group
Just a few years ago, “proof of concept” was the term heard everywhere in connection with blockchain-based solutions in the securities area. Technically, they usually turned out fine, but business-wise, less often so. Fast forward to today, while the hype has faded, a number of services have rooted, and are rapidly growing into business-as-usual.
Horacio Barakat described Broadridge processing 50 billion euro per day on the DLT repo platform – not yet much compared with the total repo market, but a clear step into everyday practice. Counterparties can enter self-executing “smart contracts” on the basis of securities uploaded to the platform in digital form.
Thilo Derenbach emphasised the distinction between, on one hand, tokenising a security, and, on the other hand, “digitising” the security by generating a “digital twin” for it. The latter puts less demands on the market participants, and is the path that Clearstream has chosen with its D7 initiative. Thilo Derenbach likens it to distributing existing music in the digital format of mp3s. Full tokenisation will come in with time, but the problems for the Australian Stock Exchange in replacing its Chess settlement system with a DLT-based one could be interpreted as a sign that the market is not yet ready for this.
As for the 7,000 listings already performed on Clearstream’s D7 platform (and 1,000 per week being added), most are German structured products.
• Our news posts from PostTrade 360° Amsterdam 2023, on 30 November, and previous years, are gathered here.
• The conference info site, with detailed agenda, is here.
• For post-event access to recorded sessions, find them listed here. To see them, you need to be logged in, and have picked up the free content pass. Sounds tricky but just follow the links!
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