Driving Efficiency in the Capital Markets Industry with Blockchain

Driving Efficiency in the Capital Markets Industry with Blockchain

By Capital Markets CIO Outlook | Wednesday, July 31, 2019

Blockchain opens options to essentially re-architect processes from testing to mainstreaming products, across various company applications.

FREMONT, CA: Blockchain provides new data management and sharing strategy as a solution to many of the inefficiencies faced by the industries. Technology specialists are working on the underlying technology, and its prospective uses in fintech start-ups, incumbent market infrastructure suppliers, and banks. It is not anticipated that blockchain solutions will substitute the present ecosystem; instead, they are incorporated into it. A McKinsey study defines the main advantages of the capital markets offered by blockchain alternatives. Here are a few of them.


The modern architecture of digital trading implies assets are traded in 'the blink of an eye.' But it can take days to clear and settle these transactions. A solution for blockchain settlement slashes the time required to do so. A 'token' cryptocurrency acting as a proxy for the transaction would be transferred to the beneficiary's wallet almost immediately, confirming the update of the ledger and constituting the settlement.

Streamlining processes

Organizations and other separate entities performing different tasks of a single process involving one set of information to be reconciled across databases. This will also assist with the unified information model, which is also suitable for reporting, to meet regulatory demands. Regulators and auditors may even have immediate access to the blockchain.

Reduction in Systemic Risk

Since transactions based on blockchain require pre-financing of trade, the risk of credit and liquidity would be virtually eliminated.

Check this Out:Top Blockchain Companies

A holistic perspective of the exposure of capital markets could enable better market risk control. Adjustments in near-real-time trading activity could be made if circumstances were warranted. Pre-trade instructions could be drawn up through smart contracts allowing automatic trade settlement and reconciliation. Overall, with blockchain technology, more effective capital market activity management and reporting to regulators could be a reality shortly.

Few Blockchain Companies:BLOQ , Cognive , Global Debt Registry

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