Germany’s Central Bank and Deutsche Börse Complete Blockchain Settlement Trial

Journalist:
David Hundeyin @DavidHundeyin
October 27, 2018

Germany central bank Deutsche Bundesbank, and Deutsche Börse have announced the successful completion of a performance test for two prototype blockchain-based securities settlement systems which they developed jointly. In an announcement posted earlier today, it was revealed that the prototype systems support settlement of regular payments, interest payments, securities transactions and repayment when bonds achieve maturity. The announcement further revealed that the systems were developed on Hyperledger Fabric version 1.0 and the Digital Asset platform.

“Demanding Performance Tests”

In a statement, the institutions stated that the prototypes were “subjected to demanding performance tests” in order to establish their suitability for the proposed use cases. According to them, the results of the tests showed that both prototypes can realistically handle the transaction load of existing financial market infrastructure and can both be built on for further improvements in the future.

Specifically, the statement singled out new releases from Hyperledger Fabric and the Digital Asset Platform as potential platforms for improving the performance of the prototypes.

Speaking about the test results, Burkhard Balz, Member of the Executive Board of Deutsche Bundesbank said:

“During this project, Deutsche Bundesbank and Deutsche Börse learned a lot about the usage of this technology and its concrete implementation. We expect the rapid development to continue, and also see the potential in using it for high-volume applications. The approach of a permissioned architecture, which takes into account the requirements of the financial sector from the outset, has proven to be right.”

In his own reaction, Berthold Kracke, CEO of Clearstream Banking AG and Head of Clearstream Global Operations at Deutsche Börse Group, said:

“We are very happy with the results of the project. The tests have shown that blockchain technology is a suitable basis for applications in the field of settlement and other financial infrastructures. Thanks to the cooperation with Deutsche Bundesbank and the expertise of Digital Asset, we were able to tailor the product to the needs of the industry.”

In February 2017, CCN reported that Deutsche Bundesbank was working on a blockchain-based settlement system which according to the institution was not yet market ready. In partnership with Deutsche Börse, the organisation developed a preliminary prototype for a blockchain-based solution for payment settlement, transferring securities, processing delivery-versus-payment transactions in which securities purchases are settled and payment is made simultaneously, and processing basic corporate actions, including coupon payments on bonds and redeeming maturing securities.

Today’s announcement comes as the culmination of nearly two years of work, and full details of the project are available for download here.

Featured image from Shutterstock.

Last modified (UTC): October 29, 2018 14:19

David Hundeyin @DavidHundeyin

I am a busy Nigerian writer, journalist and writer with an interest in tech and finance. When I'm not contributing to CCN and traveling around Africa, you can catch me contributing to CNN Africa, or in the writers room at 'The Other News', Nigeria's weekly answer to 'The Daily Show' with nearly 2 million viewers. My work on 'The Other News' was featured in the New Yorker Magazine, and that was then cited in the Washington Post so I'm not sure that counts as a feature but I'll definitely mention it too! I have been nominated by the US State Department to take part in the 2019 Edward R. Murrow Program for journalists under the International Visitors Leadership Program. I also like hamsters. You can reach me on Twitter at _David_Hundeyin