CSD Working group on DLT signed a memorandum of understanding - Depósito Central de Valores


Santiago, January 17th, 2018 - Depósito Central de Valores (DCV) together with other securities depositories and industry providers have signed a Memorandum of Understanding (MOU) in order to work together and demonstrate how DLT (Distributed Ledger Technology) could be implemented in post-trade scenarios, what new kinds of products could be built using it, and how existing standards could support it. Abu Dhabi Securities Exchange from the United Arab Emirates, Caja de Valores from Argentina, Nasdaq Market Technology AB, National Settlement Depository from Russia, SIX Securities Services from Switzerland, Strate Ltd from South Africa and SWIFT are among the members of the group working together with Depósito Central de Valores (DCV) from Chile. Additional depositories are expected to join in the coming weeks. Today, processes requiring multi-party contact, such as voting and proxy voting, involve extremely cumbersome manual processes that carry significant inherent cost and risk. As a part of the MOU, the members have defined the product requirements for an electronic voting solution based on DLT technology, which includes a greater degree of automatization and common standards (ISO 20.022). “To ensure interoperability and smooth migration, it is crucial that new technologies support existing common standards such as ISO 20022,” says Stephen Lindsay, Head of Standards at SWIFT. “The promise of technology on paper is great, but a key component around standardization is currently missing. There is clear value in re-using established business definitions and facilitating interoperability among DLT implementations, which this project will demonstrate.” Other aspects of the MOU include fostering collaboration in DLT research and development among its members. Also, helping to define the role of financial market infrastructure providers, permitting to identify, define and develop use cases in the securities depositories’ industry. In addition, the group will focus on creating and adapting common standards and principles for the use of DLT among securities depositories and the financial industry, promoting the adoption of those standards and principles to other parties, including regulators. Confirming the importance of the Working Group, the International Securities Services Association (ISSA) recently endorsed the group, including it as part of a new work stream within the association’s existing Working Group on DLT, giving this initiative greater industry visibility. “As Depósito Central de Valores, we are interested in being up-to-date on developments related to DLT technology” says Fernando Yáñez, General Manager of DCV. “This group of institutions - representative of the global market of securities depositories and industry providers - provides engineers and analysts who are experts in the business, in standards and also in technology. Together they will find solutions using DLT, which will finally facilitate interoperability among global operators of securities markets.”

Santiago, January 17th, 2018 - Depósito Central de Valores (DCV) together with other securities depositories and industry providers have signed a Memorandum of Understanding (MOU) in order to work together and demonstrate how DLT (Distributed Ledger Technology) could be implemented in post-trade scenarios, what new kinds of products could be built using it, and how existing standards could support it.

Abu Dhabi Securities Exchange from the United Arab Emirates, Caja de Valores from Argentina, Nasdaq Market Technology AB, National Settlement Depository from Russia, SIX Securities Services from Switzerland, Strate Ltd from South Africa and SWIFT are among the members of the group working together with Depósito Central de Valores (DCV) from Chile. Additional depositories are expected to join in the coming weeks.

Today, processes requiring multi-party contact, such as voting and proxy voting, involve extremely cumbersome manual processes that carry significant inherent cost and risk. As a part of the MOU, the members have defined the product requirements for an electronic voting solution based on DLT technology, which includes a greater degree of automatization and common standards (ISO 20.022).

“To ensure interoperability and smooth migration, it is crucial that new technologies support existing common standards such as ISO 20022,” says Stephen Lindsay, Head of Standards at SWIFT. “The promise of technology on paper is great, but a key component around standardization is currently missing. There is clear value in re-using established business definitions and facilitating interoperability among DLT implementations, which this project will demonstrate.”

Other aspects of the MOU include fostering collaboration in DLT research and development among its members. Also, helping to define the role of financial market infrastructure providers, permitting to identify, define and develop use cases in the securities depositories’ industry.

In addition, the group will focus on creating and adapting common standards and principles for the use of DLT among securities depositories and the financial industry, promoting the adoption of those standards and principles to other parties, including regulators.

Confirming the importance of the Working Group, the International Securities Services Association (ISSA) recently endorsed the group, including it as part of a new work stream within the association’s existing Working Group on DLT, giving this initiative greater industry visibility.

“As Depósito Central de Valores, we are interested in being up-to-date on developments related to DLT technology” says Fernando Yáñez, General Manager of DCV. “This group of institutions - representative of the global market of securities depositories and industry providers - provides engineers and analysts who are experts in the business, in standards and also in technology. Together they will find solutions using DLT, which will finally facilitate interoperability among global operators of securities markets.”

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