Deutsche Börse Group, a marketplace organizer for the trading of shares and other securities, announced that it has developed a blockchain concept for risk-free transfer of commercial bank money.
Deutsche Börse Group combines the blockchain technology with its proven post-trade infrastructure and aims to investigate possible new business opportunities that are blockchain enabled.
The blockchain concept is based on a collateralized coin, ‘CollCo’ and Eurex Clearing, Europe’s leading central counterparty (CCP) clearing house, acts as trusted party for transactions. Through the collateralization at Deutsche Börse Group’s CCP – Eurex Clearing, the credit risk inherent in tokenized coins can be mitigated.
“Our innovative concept can be the basis for a variety of use cases, among them credit risk-free cash transfers and the value transfer of assets on the blockchain,” Eric Müller, CEO of Eurex Clearing, Deutsche Börse’s clearing house, explained. “Through the involvement of our CCP as trusted third party, a clear set of rules and governance would be ensured.”
The new concept, where Eurex Clearing interfaces with the Group's central securities depository Clearstream, can also provide the potential for competency gains in post-trade processes that involve settlement, asset servicing, among others.
Following the development of blockchain concept, Deutsche Börse will work and consult with its clients, regulators and central banks, in order to get their feedback on the concept.
“Developing and launching new cutting-edge offerings is the core for Deutsche Börse. Distributed ledger technology has remarkable potential. With this pilot, we are adding another pioneering element in the area of payments and value transfer to the debate around blockchain. We look forward to further consulting with clients, regulators and central banks on our project,” Carsten Kengeter, CEO of Deutsche Börse AG stated.
The company also stated that a patent application has been filed as well as a functional and technical prototype that is based on Hyperledger Fabric is currently being developed.
Last week, four members of the ‘Liquidity Alliance’, an international group of central securities depositories (CSDs), cooperated with Deutsche Börse in order to launch an initiative leveraging blockchain technology to ease cross-border mobilization of security collateral.
