IBM and CLS, a market infrastructure group delivering settlement, processing and data solutions, announced on Monday (July 30) a collaboration on a proof of concept (PoC) for LedgerConnect, a distributed ledger technology (DLT) platform for the financial services industry.
In a press release, the companies said LedgerConnect will enable banks, buy and sell-side firms, FinTechs and software vendors to deploy, share and consume services that are hosted on a shared distributed ledger network. Through the network, financial institutions will be able to access services including Know Your Customer (KYC) processes, sanctions screening, collateral management, derivatives post-trade processing and reconciliation and market data, IBM and CLS said in the press release.
The companies noted that nine financial institutions, including Barclays and Citi, are participating in the proof of concepts and have chosen services from vendors including Baton Systems, Calypso, Copp Clark, IBM, Mphasis, OpenRisk, Synswap and Persistent Systems to participate in the PoC.
"Together, IBM and CLS have been early pioneers in advancing blockchain solutions for the financial services space," said Marie Wieck, general manager, IBM Blockchain. "Building on the success of CLSNet and leveraging the strong relationship CLS has with the world's leading financial institutions, LedgerConnect is uniquely positioned as a blockchain marketplace for the financial services industry, which will accelerate innovation across the ecosystem with value-added services for blockchain networks."
According to the companies, by operating on a private permissioned network based on the IBM Blockchain platform and Hyperledger Fabric technology, LedgerConnect will be designed for enterprises that are focused on regulation and security. Support for additional ledger technologies could come in the future depending on market demand and developments, CLS and IBM said in the press release.
"LedgerConnect is part of CLS' strategy to explore how we can provide safe and robust solutions that create efficiencies and reduce risk for a diverse range of firms operating in the financial markets. We expect LedgerConnect to deliver enhanced efficiencies and economies of scale over single-purpose distributed ledger networks," noted Alan Marquard, chief strategy and development officer, CLS.