Firms join new global blockchain network of networks
09 May 2023 US
Image: Andrey/stock.adobe.com
Digital Asset, alongside a number of other market participants, launched the “industry’s first” privacy-enabled interoperable blockchain network, Canton Network.
The Canton Network is designed for institutional assets and is built to unlock the potential of synchronised financial markets. It aims to provide a decentralised infrastructure that connects independent applications built with Daml, Digital Asset’s smart-contract language.
Almost 30 participants have joined the network so far including EquiLend, BNP Paribas, Broadridge and the Deutsche Bӧrse Group.
The platform creates a “network of networks”, allowing previously siloed systems in financial markets to interoperate with the “appropriate” governance, privacy, permissioning and controls required for high-regulated industries.
Market participants expect to experience a safer and reconciliation-free environment on the new network, where assets, data and cash can synchronise freely across applications.
This feature aims to create opportunities for financial institutions to offer new innovative products to their clients, while enhancing their efficiency and risk management.
For example, asset registers and cash payment systems are distinct and siloed systems in today’s markets, according to the Canton Network.
Using the newly launched platform, a digital bond and a digital payment can be composed across two separate applications into a single atomic transaction, enabling simultaneous exchange while minimising operational risk.
Likewise, a digital asset could be used in a collateralised financial transaction, for example in a repo or leveraged loan application, the Network adds.
The Canton Network indicates that until now, smart contract blockchain networks have not achieved meaningful adoption among financial institutions and other enterprises because of three significant shortfalls: the lack of privacy and control over data, other blockchains having to accept trade-offs between control and interoperability, and the inability to scale.
It seeks to remove these obstacles by offering a decentralised network with the privacy and control essential to operating within a safe and sound regulatory environment.
Canton Network participants will begin testing interoperability capabilities across a range of applications and use cases in July 2023.
Commenting on the launch, Ken DeGiglio, chief information officer at EquiLend, says: "By providing a shared network of trust and transparency, the Canton Network enables participants to leverage the power of decentralised technology, access new markets and drive innovation.”
Yuval Rooz, co-founder and CEO at Digital Asset, comments: “We are proud to be a founding participant of the Canton Network. For the first time, financial institutions can realise the full benefits of a global blockchain network while operating within the regulatory guardrails that ensure a safe, sound and fair financial system.
“This is a significant step forward for the blockchain space. We look forward to helping this founding group of network operators and users build and connect applications to the Canton Network.”
Cathy Clay, executive vice president of global digital and data solutions at Cboe Global Markets, adds: “At Cboe, we believe the tokenisation of real-world assets may offer an unprecedented opportunity to create new market infrastructure and drive efficiency in the trading of products across the globe.
“By leveraging new blockchain technologies, we can potentially unlock new opportunities for market participants. Efforts like the Canton Network will help our industry further explore this frontier.”
The Canton Network is designed for institutional assets and is built to unlock the potential of synchronised financial markets. It aims to provide a decentralised infrastructure that connects independent applications built with Daml, Digital Asset’s smart-contract language.
Almost 30 participants have joined the network so far including EquiLend, BNP Paribas, Broadridge and the Deutsche Bӧrse Group.
The platform creates a “network of networks”, allowing previously siloed systems in financial markets to interoperate with the “appropriate” governance, privacy, permissioning and controls required for high-regulated industries.
Market participants expect to experience a safer and reconciliation-free environment on the new network, where assets, data and cash can synchronise freely across applications.
This feature aims to create opportunities for financial institutions to offer new innovative products to their clients, while enhancing their efficiency and risk management.
For example, asset registers and cash payment systems are distinct and siloed systems in today’s markets, according to the Canton Network.
Using the newly launched platform, a digital bond and a digital payment can be composed across two separate applications into a single atomic transaction, enabling simultaneous exchange while minimising operational risk.
Likewise, a digital asset could be used in a collateralised financial transaction, for example in a repo or leveraged loan application, the Network adds.
The Canton Network indicates that until now, smart contract blockchain networks have not achieved meaningful adoption among financial institutions and other enterprises because of three significant shortfalls: the lack of privacy and control over data, other blockchains having to accept trade-offs between control and interoperability, and the inability to scale.
It seeks to remove these obstacles by offering a decentralised network with the privacy and control essential to operating within a safe and sound regulatory environment.
Canton Network participants will begin testing interoperability capabilities across a range of applications and use cases in July 2023.
Commenting on the launch, Ken DeGiglio, chief information officer at EquiLend, says: "By providing a shared network of trust and transparency, the Canton Network enables participants to leverage the power of decentralised technology, access new markets and drive innovation.”
Yuval Rooz, co-founder and CEO at Digital Asset, comments: “We are proud to be a founding participant of the Canton Network. For the first time, financial institutions can realise the full benefits of a global blockchain network while operating within the regulatory guardrails that ensure a safe, sound and fair financial system.
“This is a significant step forward for the blockchain space. We look forward to helping this founding group of network operators and users build and connect applications to the Canton Network.”
Cathy Clay, executive vice president of global digital and data solutions at Cboe Global Markets, adds: “At Cboe, we believe the tokenisation of real-world assets may offer an unprecedented opportunity to create new market infrastructure and drive efficiency in the trading of products across the globe.
“By leveraging new blockchain technologies, we can potentially unlock new opportunities for market participants. Efforts like the Canton Network will help our industry further explore this frontier.”
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