The banking and financial institutions across the world have been working on development and implementation of blockchain technology based applications into their operations. The latest news about a successful trial run of a similar blockchain technology based solution comes from AXONI.
In a recent press release, AXONI, a distributed ledger based financial technology solutions provider has reported that the company along with 6 other financial services providers has successfully tested the implementation of a blockchain technology and smart contracts based solutions. This blockchain based smart contracts solution is designed specifically to manage and address the post-trade lifecycle events associated with the standard North American single name Credit Default Swaps or CDS.
AXONI has conducted the trial with the likes of the Bank of America Merrill Lynch, Credit Suisse, Citi Group, The Depository Trust and Clearing Corporation (DTCC), JP Morgan and Markit. The trial clearly demonstrated the capability of blockchain technology when it comes to handling various complex processes associated with CDS. By using AXONI’s solution, they were able to manage amendments, compressions, novation’s and payments flawlessly over the distributed blockchain network.
This is neither the first nor the last of such trials to be conducted by different fintech companies as they try to integrate Bitcoin’s underlying technology into their operations. While each deployment varies depending upon the specific requirements of a particular company, group or sector, they all work based on the same fundamental principles as cryptocurrency’s distributed ledgers. The Credit Default Swap segment was considered for the trial due the abundance of pre-existing data and the well-established benchmarks, courtesy of the Depository Trust & Clearing Corporation’s Trade Information Warehouse.
In order to begin the test, the CDS trade confirmation data was first entered onto the blockchain. The data was stored on the blockchain in the form of smart contracts capable of automatically processing the instruments as required. The information available on the blockchain can be accessed in real time by anyone with the required privileges. This will make the process of communication with clients and regulators much easier for the financial institutions.
In addition to automation and efficiency, the use of blockchain technology will also ensure the integrity of data with enhanced privacy and security. Any information once stored on a blockchain is irrefutable and timestamped, making it easier to go back to the files at any point of time to verify the transaction details and other associated information from anywhere.
The press release also states that the technology presented by AXONI passed a total of 85 different tests with flying colors. With all the trials cleared, AXONI’s blockchain based solution may soon see the light of the day with the financial powerhouses integrating it onto their live platforms.
While AXONI has been conducting successful tests on one side, another heavyweight in the sector, R3CEV recently announced its latest breakthrough. The company as part of the banking conglomerate comprising of over 40 different international banks launched Corda, a distributed financial ledger for the banking sector.
With this breakthrough, AXONI has now become one of the proficient companies that can easily assess the requirement and deploy the right solution in less than a year.