Blockchain’s Post Trades

Blockchain's Post Trades

OK, here’s a quick test. What is the PTDL? Don’t know do you. Well, we didn’t know either BUT we are here to tell you. It’s the Post Trade Distributed Ledger Group and it’s a big deal. Got your attention? If you are in the markets you should take a read.

A research study that the Post Trade Distributed Ledger Group (PTDL Group) conducted among its members suggests about half believe blockchain will be adopted in the financial post-trade sector in the next several years.  Citing operational cost savings, increased efficiency/reduced settlement cycles and transparency, this new blockchain technology will be a major plus for financial institutions. Remember, this group is global and includes banks, custodians, clearing houses, exchanges, Central Securities Depositories, regulators, government agencies and central banks. In other words, everybody.  (Bill Taylor/CEO)

“The Post Trade Distributed Ledger Group (PTDL Group) has commissioned research among its members,  which suggests that just under half (48%) believe blockchain will become adopted in the financial post-trade area within three to five years, and 29% expect this to happen within the next one to two years. Half (50%) see it as an opportunity and only 10.5% say it’s a threat.

Blockchain will become adopted in the financial post-trade area in three to five years, according to almost half (48%) of the membership base of the Post-Trade Distributed Ledger (PTDL) Group1. In addition, just over a quarter (29%) of members believe blockchain will become adopted in as little as the next one to two years, though 21% forecast it will take in excess of five years.

The survey of PTDL’s global membership suggests that the top three benefits of distributed ledger technology will be operational cost savings (cited by 81% of respondents), increased efficiency/ reduced settlement cycles (67%), and transparency (43%). In a reflection of the significance of the new technology, a fifth (20%) of respondents said that the strategic importance of blockchain within their own organisation was ‘very high’, with an additional 34% saying it was ‘high’; only 7% said it was a ‘low’ priority.

PTDL Group members are from all continents and include global banks, custodians, Central Securities Depositories, clearing houses, exchanges, regulators, government agencies and central banks.  The organisation brings together major post-trade industry participants to share information and ideas about how distributed ledger technologies can transform the post-trade landscape. The association’s organising committee is made up of representatives from CME Group, Euroclear, HSBC, London Stock Exchange Group and State Street.

Despite the compelling arguments for the adoption of blockchain, PTDL’s members warned that industry adoption remains the most significant barrier to implementing blockchain in a wider post trade industry context – this was cited by 78% of respondents. Regulation (56%), a clear business need (55%), concerns around confidentiality (51%), and lack of standardisation (49%) complete the top five in terms of impediments. Lack of available talent is seen as the least significant concern (23%).”

Read Full Story at FTSE Global Markets