Credit Suisse and ING transfer government securities over blockchain
The underlying securities remained static in linked custody accounts held by Credit Suisse and ING.
Swiss multinational financial services company Credit Suisse and Dutch-based bank ING have completed a live securities lending transaction valued at more than US$30 million, settled using blockchain technology.
The transaction utilized the Corda blockchain. Financial innovation company R3 and a consortium of global banking institutions joined forces in mid-2016 to demonstrate how distributed ledger technology (blockchains) can transform trade financing for modern financial markets.
Credit Suisse and ING transferred legal ownership of Dutch and German government securities, worth €25 million (US$30.5 million) using HQLAx Digital Collateral Records (DCRs). However, the underlying securities remained static in linked custody accounts held by Credit Suisse and ING at Credit Suisse in Switzerland.
“The use of DCRs to effect transfers of securities can ultimately help enhance regulatory transparency, mitigate systemic risk, reduce operational risk, and help financial institutions manage capital more efficiently,” Credit Suisse said in a statement.
The DCR model was initially launched by HQLAx in April last year and is still in a testing phase.
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