Market infrastructure provider CLS, nine financial institutions and IBM are collaborating on a proof-of-concept (PoC) for LedgerConnect, a distributed ledger technology (DLT) platform designed to enable banks, financial institutions, fintechs and software vendors to share and deploy applications and services hosted on a shared distributed ledger network.
LedgerConnect, which will operate on a single, enterprise-grade network, will allow financial institutions to access apps and services such as know your customer (KYC) processes, sanctions screening, collateral management, derivatives post-trade processing and reconciliation and market data, similarly to an app store. The platform aims to make it easier and cheaper for financial firms to use blockchain-based software.
“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,” said Alan Marquard, chief strategy and development officer of CLS.
“We expect LedgerConnect to deliver enhanced efficiencies and economies of scale over single-purpose distributed ledger networks.”
LedgerConnect will operate on a private permissioned network based on the IBM Blockchain and Hyperledger Fabric technology. The platform will be designed for regulated enterprises and available across asset classes.
On completion of a successful PoC, generation of market demand, and receipt of all necessary regulatory approvals, IBM and CLS plan to make LedgerConnect widely available to the industry. Support for additional ledger technologies may be provided in the future, based on market demand and developments, the companies said.
Nine financial institutions, including Barclays and Citi, are participating in the PoC 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 PoC.
Lee Braine, from the chief technology office of Barclays’ investment bank, told Reuters:
“Barclays is participating in the LedgerConnect PoC so we can gain an understanding and experience of a new network for blockchain applications – and also test some candidate use cases on that network.”