CLS, a market infrastructure group delivering settlement, processing, and data solutions, and IBM are collaborating on a proof of concept for LedgerConnect—a distributed ledger technology (DLT) platform for the financial services industry. The platform is designed to enable banks, buy and sell side firms, FinTechs, and software vendors to deploy, share, and consume services hosted on a shared distributed ledger network.
Using LedgerConnect, financial institutions will be able to access services in areas including “know your customer” processes, sanctions screening, collateral management, derivatives post-trade processing and reconciliation and market data. By hosting these services on a single, enterprise-grade network, organizations can focus on business objectives rather than application development, enabling them to realize operational efficiencies and cost savings across asset classes.
Nine financial institutions, including Barclays and Citi, are participating in the proof of concept and have selected services from a number of vendors including Baton Systems, Calypso, Copp Clark, IBM, MPhasis, OpenRisk, SynSwap and Persistent Systems to participate in the proof of concept.
According to IBM and DLT, as financial institutions increasingly work to implement DLT into their operations, capital markets remain saturated with multiple systems performing the same business functions and with siloed pockets of data that require expensive reconciliation processes.
LedgerConnect aims to provide a single shared and highly secured network on which multiple services can be deployed and consumed. This will allow financial institutions to focus on transforming business processes rather than creating multiple new blockchain applications, networks and services in silos that could lead to increased interoperability costs and complexity.
Operating on a private permissioned network based on the IBM Blockchain Platform and Hyperledger Fabric technology, LedgerConnect will be designed for regulated and security-conscious enterprises and available across asset classes. Support for additional ledger technologies may be provided in the future, based on market demand and developments.
"Together, IBM and CLS have been early pioneers in advancing blockchain solutions for the financial services space," said Marie Wieck, general manager, IBM Blockchain. "Building on the success of CLSNet and leveraging the strong relationship CLS has with the world's leading financial institutions, 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."
On completion of a successful proof of concept, generation of market demand, and receipt of all necessary regulatory approvals, CLS and IBM plan to make the platform widely available to the industry.
For more information, go to www.ibm.com/blockchain and www.cls-group.com.