New York and London - Eleven firms have announced the successful completion of a pilot to manage equity swap transactions and related post-trade lifecycle events. The implementation employs blockchain smart contracts and uses an optimized data structure in a distributed, peer-to-peer network to enable perpetual reconciliation.
A continuation of an initial proof of concept, the pilot expanded the blockchain network to process equity swap lifecycle events, end-to-end. Having both sides of a swap transaction on the same ledger allows counterparties to simultaneously view and share data during the entire lifecycle of the swap - from proposal to termination.
The pilot was managed by Axoni and executed on AxCore, Axoni's distributed ledger software. The broad participant group included seven swap market participants from both the sell-side and buy-side including: BNP Paribas, Citi, Credit Suisse, Canada Pension Plan Investment Board, Goldman Sachs, J.P. Morgan as well as industry service providers IHS Markit and Thomson Reuters. ISDA provided equity derivatives documentation expertise and Capco provided consulting services.
Thomson Reuters pricing and reference data was also integrated with the Axoni solution to provide market data, including equity prices, FX rates, benchmark rates, and corporate actions directly on the blockchain to enable the smart contracts' automated workflows.