DTCC also announces results of proof-of-concept to optimize collateral management using tokenization.
New York/London/Hong Kong/Singapore/Sydney/Tokyo/Abu Dhabi, October 15, 2024 ‒ The Depository Trust & Clearing Corporation (DTCC), the premier post-trade market infrastructure for the global financial services industry, today announced DTCC Digital Launchpad, an industry sandbox intended to bring together financial market participants and clear the path to scalable adoption of digital assets. As an open ecosystem, DTCC Digital Launchpad will feature market participants, technology providers, and others working together to identify and collaborate on meaningful pilots that have a clear path to production.
“DTCC Digital Launchpad will unify stakeholders from nearly every corner of the financial markets to solve the challenges facing adoption of digital asset technology,” said Frank La Salla, DTCC President, CEO and Director. “As an industry-owned and governed infrastructure for the world’s largest capital markets, DTCC is uniquely suited to drive industry collaboration under the banner of a larger goal: building a digital asset ecosystem that’s as safe and sound as the one we have for traditional securities today.”
Current estimates suggest tokenization presents a monumental business opportunity, with projections stating $16 trillion dollars in tokenized securities could be on digital rails by 2030. However, adoption of this technology has stalled as the industry continues working in silos. Most digital asset initiatives today have differing and conflicting standards, controls, and operational processes, leading to a fragmented digital landscape.
“We’ve reached a critical inflection point in the adoption of digital asset technology, and DTCC is challenging the industry to rethink and reframe its siloed approach,” said Nadine Chakar, Global Head of DTCC Digital Assets. “The ultimate objective of DTCC Digital Launchpad is to bring the industry together to build production-ready, secure, and efficient digital market infrastructure and standards that will transform capital markets for generations to come.”
DTCC Digital Launchpad provides:
- DLT infrastructure featuring capabilities from the DTCC Digital Assets product suite. These capabilities help firms address some of the industry’s biggest challenges around data, liquidity, and infrastructure, including interoperability and data harmonization
- Robust and scalable infrastructure, enabling firms to get started on their digital asset journeys without having to build their own ecosystem
- One platform, two objectives:
- Industry Launchpad: An open ecosystem for broad collaboration. DTCC will publicize our prioritized pilots in Q1 2025, starting with an initial group of participants invited to co-develop these solutions. These initiatives are designed to unite the industry behind addressing critical pain points and paving the way for scalable solutions that drive industry-wide progress
- Client Launchpad: A dedicated space to leverage comprehensive digital asset capabilities from DTCC Digital Assets. Clients can explore and develop their own innovative use cases without substantial investment. DTCC’s professional services team is on hand to offer guidance and provide product support to drive these initiatives to production
DTCC today also announced the results of a recent proof-of-concept on DTCC Digital Launchpad. Led by Japan Securities Clearing Corporation (JSCC), clearinghouse of Japan Exchange Group, the proof-of-concept explored how central counterparties (CCPs) could use tokenization to optimize the collateral management process for clearing members and their buy-side firms. In particular, it examined how margin calls and their associated processes could be automated, made more efficient and transparent for all participants using digital assets and smart contracts – or rules that automatically execute on a distributed ledger when certain conditions are met.
“JSCC is excited to share the results of our successful proof-of-concept, which demonstrated that digital assets and smart contracts technology could be leveraged to introduce operational and capital efficiencies for market participants in the collateral management process,” said JSCC President & CEO, Konuma Yasuyuki. “By leveraging DTCC’s reusable blockchain-based infrastructure, we were able to jump-start our proof-of-concept, easily issuing digital assets such as cash, stocks, and bonds without needing to develop our own infrastructure. This allowed us to shift our focus to the initiative’s impact on our own business processes.”
DTCC encourages the industry to read the results from JSCC, a key first step as the firm now invites the industry to explore how they can leverage DTCC Digital Launchpad to support large-scale initiatives in shared environments.
About DTCC
With over 50 years of experience, DTCC is the premier post-trade market infrastructure for the global financial services industry. From 20 locations around the world, DTCC, through its subsidiaries, automates, centralizes, and standardizes the processing of financial transactions, mitigating risk, increasing transparency, enhancing performance and driving efficiency for thousands of broker/dealers, custodian banks and asset managers. Industry owned and governed, the firm innovates purposefully, simplifying the complexities of clearing, settlement, asset servicing, transaction processing, trade reporting and data services across asset classes, bringing enhanced resilience and soundness to existing financial markets while advancing the digital asset ecosystem. In 2023, DTCC’s subsidiaries processed securities transactions valued at U.S. $3 quadrillion and its depository subsidiary provided custody and asset servicing for securities issues from over 150 countries and territories valued at U.S. $85 trillion. DTCC’s Global Trade Repository service, through locally registered, licensed, or approved trade repositories, processes more than 20 billion messages annually. To learn more, please visit us at www.dtcc.com or connect with us on LinkedIn, X, YouTube, Facebook, and Instagram.
