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A solution for managing high-quality liquid assets: How distributed ledger technology can benefit the securities lending market
Journal of Securities Operations & Custody,
11
(4),
282-291
(2019)
Abstract
For the financial industry, the need to manage high-quality liquid assets (HQLA) efficiently and the related topic of collateral mobility are more relevant than ever. In the aftermath of the global financial crisis, they have posed a significant challenge for the industry. Progress on this issue is strongly linked to the evolution of new technologies. This paper assesses the current situation and how distributed ledger technology (DLT) can help to address this subject and improve the securities lending market. It examines which aspects need to be taken into consideration when designing a DLT solution, how it can be implemented and what are the next steps on our way to solving one of the most pressing issues for the future of financial services.
Keywords: Blockchain; DLT; collateral mobility; HQLA; tokenisation
The full article is available to subscribers to the journal.
Author's Biography
Gerd Hartung has been with Group Deutsche Börse since 1996. As Senior Vice President, he has joined the DLT, Crypto Assets and New Market Infrastructure area of Deutsche Börse AG and is in charge of various DLT initiatives including LA Ledger (a joint initiative of CSDs from the Liquidity Alliance) and HQLAx. Prior to joining Group Deutsche Börse, Gerd was a Project Manager at Deutsche Bank from 1992, where he developed IT solutions for risk controlling as well as for asset/liability management.
Kevin Rutter is R3’s Research Lead, based in New York. He has led R3’s research department, helping to provide thought leadership across capital markets, cash and payments, insurance, identity and global trade applications of blockchain technology. Prior to R3 he worked in the equity derivatives markets at Peak6 in Chicago.
Guido Stroemer CEO of HQLAx, is a financial market veteran with over 25 years of professional work experience in a variety of trading, risk management and senior leadership positions. Prior to founding HQLAx, Guido was global head of repo trading at UBS. HQLAx is a financial technology innovation firm that specialises in delivering liquidity management and collateral management solutions for institutional clients in the global securities lending and repo markets.
