DTCC is testing the capabilities of blockchain technology and tokenization to improve the availability of price and rate (NAV) data in different trading environments.
The Depository Trust and Clearing Corporation (DTCC), which provides clearing and settlement services for financial markets, recognized that blockchain technology can significantly improve the availability and management of NAV data, driving different use cases.
In a release press, the corporation highlighted the NAV data interoperability as the main advantage of using and integrating blockchain technology. He noted that in the increasing digitalization of the financial industry, blockchain serves as a key enabler to explore new capabilities and initiatives in financial services, such as tokenized funds and brokerage account applications.
For the Smart NAV pilot, the DTCC relied on the capabilities of Chainlink’s cross-chain interoperability protocol, CCIP. The pilot included the participation of large companies and financial institutions, such as BNY Mellon, State Street and Franklin Templeton, which have also been exploring the advantages of blockchain in financial processes.
New use cases for NAV data
DTCC stated that upon completion of the Smart NAV pilot, it found that tokenizing and delivering data on the blockchain enables this structured data to be used for a broad range of financial industry use cases, while significantly improving automated real-time data dissemination and integrated access to historical data.
Tokenization is one of the most unique use cases that institutions are currently exploring for blockchain technology.
“In its simplest form, Smart NAV focuses on providing the ability to make trusted and verifiable data available on (virtually any) blockchain network(s) to support the use of that data in business workflows,” the DTCC noted.
Like DTCC, institutions are turning to blockchain to automate processes, increase productivity, discover new applications and features, reduce risks and costs, and generally streamline operations. On the other hand, in the case of data administration and management, on-chain tokenization also ensures veracity, prevents manipulation and fraud, and improves privacy – key features for the security of financial operations.
Through CCIP, Chainlink offers a unique interoperability platform through which institutions can interact with any blockchain network for a variety of use cases, ranging from transferring assets across multiple chains to creating optimized solutions or new products and services.
In addition to DTCC, other institutions that are exploring the potential of blockchain technology through Chainlink are Index Coop, Rapid Addition, Australia and New Zealand Banking Group and SWIFT, the international cooperative society that operates as a global network of financial institutions.
On May 16, following the publication of the DTCC report, the price of LINK, the native cryptocurrency of the Chainlink network, rose by more than 15%. At press time, LINK has accumulated a weekly growth of 19,7%, according to data from the CoinMarketCap platform, trading at around $16,20 per unit.
