Originally published on: October 16, 2024
The Depository Trust and Clearing Corporation (DTCC) has recently introduced a cutting-edge digital sandbox aimed at revolutionizing the capital market infrastructure. Known as the DTCC Digital Launchpad, this platform will serve as an open ecosystem where market participants and technology providers can collaborate on pilots with a clear pathway to production. The inception of this digital sandbox follows a successful proof-of-concept initiated by the Japan Securities Clearing Corporation (JSCC).
A select group of participants has been invited to join the DTCC Digital Launchpad in order to spearhead initiatives that tackle crucial collateral management challenges and ultimately develop scalable solutions. The outcomes of these projects are scheduled to be unveiled in the first quarter of 2025.
Furthermore, clients of DTCC will have full access to the DTCC Digital Assets suite of products within the sandbox, enabling them to create their own unique use cases without the need for significant investments. DTCC will offer guidance and support to these clients throughout their innovation journey.
Nitin Gaur, the Global head of DTCC Digital Assets, emphasized the organization’s commitment to transforming the digital asset industry by challenging its traditional siloed approach. He highlighted the success of the collaboration between DTCC and JSCC in conducting a proof-of-concept for the Digital Launchpad. This project explored the integration of digital technology in collateral management, particularly focusing on central counterparties and achieving noticeable enhancements in speed and transparency.
JSCC was able to tokenize cash, stocks, and bonds using DTCC infrastructure during the proof-of-concept. Smart contracts were leveraged to streamline margin calls and the deposit or withdrawal of digital assets, as detailed in a recent white paper.
In a significant milestone, the DTCC and Digital Asset recently concluded a pilot project called the US Treasury Collateral Network on the Canton Network, involving 26 market participants who executed 100 transactions.
With its subsidiaries handling a staggering $3 quadrillion in securities transactions in 2023, DTCC is a key player in the global capital markets. The Depository Trust Company, one of its subsidiaries, provides custody and servicing valued at $85 trillion for securities from more than 150 countries and territories.
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