Deutsche Bundesbank in collaboration with the Deutsche Börse stated that they have successfully tested Blockchain prototypes for the support of the settlement of securities transactions, bond repayments at maturity and the usual payments.
26 October 2018 – The central bank of Germany, Deutsche Bundesbank and the Deutsche Börse, the owner of the Frankfurt Stock Exchange, have reportedly completed a Blockchain trial that aimed to explore the technology’s potential in securities settlement.
The two institutions announced in a joint press release this Thursday that two Blockchain prototypes built to their specifications were “successfully” completed. Prototypes managed to support the settlement of securities transactions, bond repayments at maturity and the usual payments.
The project was commenced in March 2016, when both parties established the BLOCKBASTER project. The project was aiming to carry out Blockchain-based settlement technology research. The end goal of the project was to create “a conceptual prototype” for the Blockchain-based system to transfer and settle securities and fiat currency.
These prototypes were developed on Hyperledger Fabric. The Blockchain platform was designed by Digital Asset (DA), which is collaborating with the Australian Securities Exchange to replace its CHESS system in 2020.
As per the release, the tests indicated that the prototypes are able to simplify the “productive operation of a realistic financial market infrastructure.” Fresh upgrades of both Blockchain platforms can further advance the performance in case they are integrated, says the release.
Blockchain High-volume Applications
The CEO of Clearstream Banking and head of Clearstream Global Operations at Deutsche Börse Group, Berthold Kracke, has commented on the news:
“The tests have shown that blockchain technology is a suitable basis for applications in the field of settlement and other financial infrastructures.”
Burkhard Balz, member of the executive board, Deutsche Bundesbank, stated that the firms anticipate that the development will carry on and that they will see a “potential in using it for high-volume applications.” He explained:
“The approach of a permissioned architecture, which takes into account the requirements of the financial sector from the outset, has proven to be right.”
In the meantime, some global major firms are paying increased attention to the Blockchain technology as a means to improve settlement and payment system. This week, the UK-based settlement infrastructure provider SETL received a license from French securities regulator to operate a central securities depository system with the use of the Blockchain tech.
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