EquiLend taps Digital Asset for DLT-powered securities finance solution

Rick Steves

“Using Daml and Canton will significantly reduce reconciliation breaks and create a single ledger for trading activity for all market participants, leading to more efficient and profitable trades.”

blockchain

EquiLend has selected Digital Asset to provide the distributed ledger technology underpinning the EquiLend 1Source initiative, which aims to resolve the central pain points and risks impacting the securities finance industry.

The securities-focused fintech firm will leverage Digital Asset’s DLT to provide market participants with a “single source of truth” for securities finance transactions.

EquiLend 1Source was unveiled in July 2022 as part of the firm’s Digital Transformation Working Group, which consists of many of the world’s largest banks and broker-dealers.

1Source for reducing reconciliation breaks and creating a single ledger for trading activity

Kelly Mathieson, Chief Business Development Officer at Digital Asset, said: “We are excited to embark on this partnership with EquiLend, which we believe will transform the securities finance market. Using Daml and Canton will significantly reduce reconciliation breaks and create a single ledger for trading activity for all market participants, leading to more efficient and profitable trades. We are grateful that EquiLend has entrusted us as their leading technology partner for this project.”

Ken DeGiglio, Chief Information Officer of EquiLend, commented: “EquiLend has a long history of creating efficiency through automation in the securities finance market. EquiLend’s 1Source initiative represents a once-in-a-generation opportunity to propel the industry forward with an innovative new approach to lifecycle management. By leveraging Daml and Canton from the distributed ledger experts at Digital Asset alongside our deep experience and network in the securities finance industry, we are confident that the 1Source initiative will result in a modernized new securities finance industry.”

Trade details stay in sync throughout the entire lifecycle for both parties

The use of blockchain will offer an alternative to the current process, in which counterparties to a securities lending transaction record contract details separately in their respective systems, often leading to “breaks” downstream in the trade lifecycle.

Digital Asset’s Daml smart contract language and its Canton ledger will power the EquiLend 1Source initiative to ensure trade details stay in sync throughout the entire lifecycle for both parties, eliminating the need for costly and inefficient reconciliation processes down the line.

The goal is to ultimately provide industry improvements, increase efficiency, reduce risk, and limit regulatory fines for unmatched trades past the established regulatory timeframes.

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