Global funds transaction network Calastone has confirmed that the technology underpinning the core of its global transaction network will be migrated onto a full blockchain-enabled infrastructure.
Calastone’s network connects more than 1,300 financial service organisations across 34 global markets processing over £80 billion of trades and 7 million messages each month, which the firm claims makes it the largest global fund transaction network.
In June, Calastone successfully completed the first phase of its blockchain-enabled distributed market infrastructure (DMI) proof-of-concept (PoC), which saw Calastone test and verify the feasibility of using the technology to create a global marketplace for the trading and settlement of mutual funds. 2019 will see the technology underpinning the core of its network moving to a private and permissioned based blockchain infrastructure.
The mutual funds market remains a sector challenged by operational inefficiencies, cost and risk, often resulting in an inability to meet fast evolving customer demands. The current requirement to replicate and reconcile records across the value chain creates an overhead which “dwarfs the benefits already offered by Calastone’s trading and settlement solutions. The move to blockchain enables the firm’s global customer base to plan for and deliver major improvements in a controlled, measured way”.
In a statement Calastone said that this migration enables it to achieve the highest levels of operational resilience and scale through the distributed, yet private nature of the new blockchain infrastructure. “The PoC has proven the performance capabilities that enable the processing of transaction volumes and fund flows to be many times greater than are expected today, demonstrating scalability of the new infrastructure.”
Julien Hammerson, Calastone’s chief executive, added: “In making this first step using blockchain, we are providing our customers with the requisite tools they need, to be future-ready. We are delivering a solution that will not disrupt the current connectivity and interaction our customers have with our network, rather putting them in pole position to make the step change to the blockchain when timely and additive to their specific objectives and requirements.”