Technology
Global Funds Network Out Of Starting Gate On Blockchain Pilot

Calastone, which has offices in London , Luxembourg , Hong Kong and Sydney, is seeking to use blockchain technology to underpin its new platform.
Calastone, a fintech
operating a global funds platform, has completed the first phase
of a pilot project testing whether blockchain technology
could underpin a new online mutual funds
marketplace.
The proof-of-concept model was able to process transactions
equivalent to a day's trading using blockchain technology,
Calastone said in a statement. The transactions were sourced from
the firm's global network, which services more than 1,200 fund
distribution and fund manager clients across 34
jurisdictions.
A blockchain is a virtual distributed ledger of transactions
shared peer-to-peer that can record ownership across a public
network of computers rendered tamper-proof by advanced
cryptography.
The technology is causing a stir within the financial services
sector as its supporters believe it could reduce hidden expenses
in the financial system by ousting inefficiencies across areas
such as payments, syndicated loans and equity clearing.
Although blockchain rose to fame as the platform underpinning the
controversial digital currency bitcoin, its uses are incredibly
wide reaching.
"Successful initial testing, involving a large volume of trades
across a fully representative global market universe, has given
us a powerful understanding of how to optimise the distributed
ledger [blockchain] technology to reduce the frictional cost of
trading across the industry on a global scale,” Campbell
Brierley, chief information officer of Calastone, said. “Placing
the market on a blockchain effectively opens the door for
potential efficiencies across the whole transaction life-cycle in
excess of those that could be achieved via the optimisation of
transaction processing alone."
The firm is preparing to carry out the second phase of the
proof-of-concept, and is engaging with “a number” of design
partners from its client base.
"The design partners will help us test the model and understand
the business challenges and requirements from a market
participant perspective,” Ken Tregidgo, Calastone's deputy chief
executive, said. “It's through technological innovation such as
this that we aim to address the business and technical trading
challenges faced by our customers across international markets.”