Icap Completes Blockchain Proof of Technology

Firm's PTRI division partners with blockchain fintech vendor Axoni.

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Interdealer broker Icap announced its Post Trade Risk and Information (PTRI) division completed a proof of concept of a distributed ledger using blockchain technology.

The PTRI used the multi-asset messaging and matching Harmony network and blockchain technology from Axoni in order to create a peer-to-peer, distributed ledger network using smart contracts. The firms' partnership is grounded in Axoni's involvement in Euclid Opportunities, Icap's fund that invests in early-stage fintech companies.

The proof of technology was tested by using bilaterally executed spot/forward foreign exchange (FX) block trades. Matched messages from Traiana's Harmony network were imported and then converted in real time to blockchain-based smart contracts.
Smart contracts were distributed to nine representative participant nodes on the blockchain network. Trades were permissioned for additional services such as valuation, compression and reporting.

According to a statement by Icap, the proof of technology showed the potential to do several different things, including:

  • Provide a common golden source of user transaction and reference data cross asset
  • Enrich and enhance the accuracy and timeliness of data by users and attach further information
  • Continuously update copies of the data to be stored locally on users' servers
  • Securely code messages to be viewed only by permissioned participants
  • Reduce operational risk and improve reconciliation and operations processes
  • Realize multiple back-office and technology cost savings

Icap also said in a statement the proof of concept shows there is the potential to grow existing PTRI solutions without disrupting the basic roles of current market participants or requiring firms to immediately switchover from their existing architecture.

"In successfully completing a proof-of-technology test, Icap has demonstrated one of the first real-world applications of distributed ledger technology that has the ability to significantly transform the post-trade landscape," said Jenny Knott, CEO of PTRI, in a statement. "Realizing the value of Icap's unique portfolio of PTRI businesses and investee companies, we have combined our expertise, networks and technology with Axoni's distributed ledger technology to push the boundaries of post-trade innovation."

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