- CLS, the largest provider of FX settlement services, has announced that it is opening a blockchain-based netting service
- According to their CSO, the service will begin small but expand in the future
- According to a recent white paper, IBM’s blockchain-based platform handles almost 3 million transactions a day
A new blockchain-based betting service will be launched by CLS, the world’s leading provider of FX settlement services, in a few days. This announcement was made by the company’s Chief Strategy Officer, Alan Marquard, at the IBM Think Conference on the 14th of November 2018.
According to him, the company would be introducing the worlds first “enterprise-level, open-for-business service” based on blockchain technology.
Netting refers to the process of offsetting the value owed between several parties and also determines what amount is owed to which party.
Marquard hinted that the service would initially be small but would increase in size over time.
When asked about the starting trading volumes, he said,
“It doesn’t matter. It will be interesting to see what we are doing by the end of Q1 though. We also start small with something like this and watch closely.”
However, previously published white paper between IBM and CLS stated that IBM’s blockchain solution could handle up to 2.9 million transactions a day and tie up $100 million in capital.
This is also a significant improvement in dispute settlement, 25,000 of which are handled by the Blockchain each year.
Typically, these should take up to 40 days to settle but with the Blockchain, it takes less than 10.
“People in the markets currently spends thousands and thousands on reconciliation and even litigation, trying to settle every little thing,” Alan Marquard said.
When speaking on the state of DLT in the financial sector, Marquard stated that there is a need to collaborate with people who understand both blockchain as well as the financial world.
“What you want to disrupt is efficiency. Disruption may sound exciting but make sure you do it with those who know the business processes you are trying to solve,” he said.
Thankfully, the global understanding of Blockchain has grown and application of the technology is more realistic unlike during its early days.
“If I have to be brutal… in the early days of blockchain, there was a lot of pretty uninformed promise of changing the world, by people who haven’t taken the effort to understand the space.” said Marquard.