Distributed ledger technology (DLT) reduces costs by about 14 trillion yen annually: financial industry lobby group | coindesk JAPAN | Coindesk Japan

Using distributed ledger technology (DLT) in the stock market could save more than $100 billion annually. The Global Financial Markets Association (GFMA), a representative lobby group of the traditional financial industry, wrote in a report released on May 16.

GFMA calls on regulators to leverage the distributed ledger technology that underpins crypto-assets, the so-called blockchain, for collateral management, asset tokenization, and sovereign debt markets such as government bonds. GFMA members include JPMorgan Chase, HSBC, Nomura Securities and other major financial institutions representing the United States, Europe and Asia.

“Distributed ledger technology has the potential to drive growth and innovation,” said GFMA CEO Adam Farkas.

“This possibility should not be ignored or prohibited where regulatory oversight and resilience measures already exist,” he continued, calling for a harmonized international framework for DLT-based market linkages. .

Automating processes such as the settlement of stock splits and mergers using smart contracts is expected to save $15 billion to $20 billion.

The report reflects growing enthusiasm from traditional financial players for the use of distributed ledger technology (DLT), the so-called blockchain.

Brussels-based clearing and settlement specialist Euroclear will soon release a new platform for fixed income trading based on DLT. The European Central Bank (ECB) is looking at ways to effectively link financial payment systems with decentralized technology.

｜Translation: coindesk JAPAN
｜Editing: Takayuki Masuda
| Image: Lorenzo Cafaro/Pixabay
｜Original: DLT-Powered Financial Markets Could Save $100B Per Year, TradFi Study Says