Market infrastructure group CLS has collaborated IBM to provide distributed ledger technology (DLT) platform for the financial services industry.
Image: IBM CHQ in Armonk, New York. Photo: courtesy of Treesmittenex/Wikipedia.org.
The companies are collaborating on a proof of concept (PoC) for LedgerConnect, a DLT platform designed to allow banks, buy and sell side firms, FinTechs and software vendors to deploy, share and consume services hosted on a shared distributed ledger network.
IBM Blockchain general manager Marie Wieck said: “LedgerConnect is uniquely positioned as a blockchain marketplace for the financial services industry, which will accelerate innovation across the ecosystem with value added services for blockchain networks.”
Via LedgerConnect, the financial institutions can access services in areas such as but not limited to, know your customer processes, sanctions screening, collateral management, derivatives post-trade processing and reconciliation and market data.
Organizations can focus on business objectives rather than application development, by hosting these services on a single enterprise-grade network.
Nine financial institutions, including Barclays and Citi, are taking part in the PoC. They have selected services from multiple vendors such as Baton Systems, Calypso, Copp Clark, IBM, MPhasis, OpenRisk, SynSwap and Persistent Systems.
DLT will help to reduce inefficiencies and improve the speed of doing business by offering a single shared version of events and one implementation of common business functions.
According to IBM, the creation and operation of own DLT infrastructure for multiple services is cost prohibitive and time-consuming for each vendor, bank or consortium.
LedgerConnect serves as a solution to this problem by offering a single shared and highly secured network on which multiple services can be deployed and consumed.
The platform will enable financial institutions to focus on advancing business processes rather than creating multiple new blockchain applications, networks and services, enabling to reduce interoperability costs and complexity.
Designed to serve regulated and security-conscious enterprises and available across asset classes, LedgerConnect will be operated on a private permissioned network based on the IBM Blockchain platform and Hyperledger Fabric technology.
CLS chief strategy and development officer Alan Marquard said: “LedgerConnect is part of CLS’s strategy to explore how we can provide safe and robust solutions that create efficiencies and reduce risk for a diverse range of firms operating in the financial markets.