13 Mar 2024
Financial blockchain provider Digital Asset, in collaboration with major firms including Goldman Sachs and BNY Mellon, has successfully concluded a pilot of its Canton Network, which aims to bring together 22 distributed ledger applications within capital markets.
The pilot's execution of over 350 simulated transactions demonstrated how an interconnected network of dApps can facilitate secure, atomic transactions across various segments of the capital markets value chain. This achievement underscores the potential benefits of reducing counterparty and settlement risk, optimizing capital, and enabling intraday margin cycles through such a network.
Participating firms gained access to a suite of distributed ledger applications, covering asset tokenization, fund registry, digital cash, repo, securities lending, and margin management transactions. These applications seamlessly interoperated via the Canton Network TestNet, showcasing real-time settlement and immediate reconciliation while ensuring compliance with regulatory requirements for asset control, security, and data privacy.
The pilot witnessed widespread participation across the market spectrum, with asset managers, banks, custodians, exchanges, and financial market infrastructure providers engaging in simulated transactions and demonstrations.
Over a four-day period, participants explored 22 dApps, facilitating the exchange of tokenized securities, money market funds, and deposits across various applications. The results highlight the Canton Network's potential to mitigate costs, risks, and inefficiencies while meeting regulatory standards for traditional asset tokenization, transfer, and settlement.
Industry leaders such as BNY Mellon, Broadridge, DRW, EquiLend, Goldman Sachs, Oliver Wyman, and Paxos contributed their expertise to the pilot program, emphasizing its significance in advancing blockchain innovation in capital markets.
“Canton allows previously siloed financial systems to connect and synchronize in previously impossible ways while abiding by the current regulatory guardrails," said Yuval Rooz, CEO and Co-Founder of Digital Asset. "We’re proud to facilitate the pilot and look forward to working with the pilot participants to continue identifying additional use cases where the Canton Network can be leveraged.”
The Canton Network's public-permissioned structure addresses previous challenges of data control and privacy while maintaining interoperability and regulatory compliance. Participants maintain privacy in transactions across applications, with transaction validation performed by a defined set of nodes, ensuring control over application performance.
The pilot attracted participation from a diverse array of institutions, including abrdn, Baymarkets, BNP Paribas, BOK Financial, Cboe Global Markets, Commerzbank, DTCC, Fiùtur, Generali Investments, Harvest Fund Management, IEX, Nomura, Northern Trust, Pirum, Standard Chartered, State Street, Visa, and Wellington Management, with Deloitte as an observer and Microsoft as a supporting partner.
Digital Asset's technology and guidance played a pivotal role in supporting the pilot, positioning the company as a key technology and infrastructure provider for the Canton Network.