Fund transaction network calastone bets big on blockchain: R3 completes trial of Cordakyc
6 de diciembre, 2018
Tiempo estimado de lectura: 2 minutos
UK-based Calastone, a transaction network for investment funds, has announced it’s migrating its entire global network to blockchain in May 2019, per a press release
Calastone provides services to over 1,700 financial institutions (FIs) in 40 global markets, including JPMorgan Asset Management, Schroders, and Invesco. It helps these firms sell their funds globally through its network of banks and local financial advisors. The migration to its new distributed market infrastructure (DMI) will see over 9 million messages between those involved in fund transactions, equating to more than £170 billion ($217 million), shift to blockchain. The announcement follows tests on blockchain for the buying and selling of mutual funds since 2017, with the firm concluding the technology was satisfactory, per The Financial Times.
Calastone’s blockchain bet could transform the fund industry. Currently, fund transactions require parties involved in the process to input the same information for settling trades. This includes a number of digital messages sent between firms that buy into a fund. Although these digital processes tend to be more reliable than manual methods like fax — which some in the industry still use — they are, nonetheless, cumbersome, time-consuming, and open to error. Switching to blockchain will not only optimize this process but also reduce global fund industry costs, excluding the US, by as much as £3.4 billion ($4.2 billion) annually, according to Calastone citing research by Deloitte. These savings will transform an industry hampered by price pressures and rising costs, and render the existing system financially and operationally obsolete, Julien Hammerson, chief executive of Calastone said in the release.
This is further evidence that blockchain is moving toward the mainstream. We’ve seen major FIs across sectors trialing blockchain over the past few years, with BNP Paribas Asset Management and Ostrum Asset Management among those exploring its use for fund transactions. However, very few projects have gone live, driven in part by worries over costs and regulation. The latest announcement suggests these worries may be easing, as companies’ exploratory efforts provide a greater understanding of the benefits the technology can provide. Given the considerable savings Calastone estimates, this initiative could provide it with a competitive advantage over those that have yet to adopt the technology, spurring further involvement from competitors. Separately, as we head into 2019, we expect to see even more live rollouts being announced.
Fuente: Business Insider
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