Deutsche Börse is planning to launch a regulatory compliant next-generation digital post-trade platform.
Dubbed ‘D7’, the new cloud-backed and DLT-ready platform will enable market participants to digitise their financial products with continuing access to both existing central and distributed infrastructures and markets.
The German exchange has joined forces with several leading domestic and international financial firms including BNP Paribas, Citi, DekaBank, Deutsche Bank, dwpbank, DZ Bank, Goldman Sachs, Raiffeisen Bank International and Vontobel.
The D7 platform paves way for same-day-issuance and paperless, automated straight-through processing for the entire value chain of issuance, custody, settlement, payment and asset servicing for digital securities, according to Deutsche Börse.
As of mid-2022, over 80% of German securities will be digitisable via D7, fostering digitisation of the German and European financial markets.
D7 will complement the Group’s established “7 Market Technology” infrastructure portfolio.
“With D7, we’re providing the financial community with a next-generation digital securities post-trade platform to unlock the potential of truly digital and decentralized finance,” said Stephan Leithner, member of the Executive Board of Deutsche Börse, responsible for Pre- & Post-Trading.
He added, It’s time not only to digitize single processes; it’s time to reinvent post-trading altogether for a stronger, more sustainable and digital future of securities markets.”
Christoph Böhm, CIO/COO and member of the Executive Board of Deutsche Börse, notes, “D7 reflects our strategic ambitions and the clear focus we put on fostering innovation and new technologies.
We are creating the next generation of future-proof financial infrastructure for the digital era, delivering cutting-edge technology and services, and paving the way for the transformation towards digital markets for our industry.”
The complete functionality of the D7 platform will be rolled out in phases with this November being the start with the new central register of Clearstream Banking. This will form the issuance and custody of dematerialised securities for the first time in Germany in compliance with new legislation introduced earlier this year -the Electronic Securities Act (Gesetz über elektronische Wertpapiere – eWpG) which would allow the issue of bearer bonds without a physical securities certificate.
The exchange said mid-2022 will be the start of dematerialised issuance which will reduce friction, the need for reconciliation, as well as administrative efforts and costs significantly.
Next year until 2024 will see the remaining distributed network and DLT capabilities being implemented. This will include connection to existing specialised DLT offerings, such as HQLAx for collateral basket lending service and FundsDLT for funds administration/distribution.
©Markets Media Europe 2021