Wall Street’s clearinghouse seeks ‘high-performance’ blockchains to tokenize corporate actions
DTCC CEO Frank La Salla said the clearing giant is working with layer-1 blockchains to bring millions in corporate actions like dividend payments onchain, but challenges remain.
What to know:
- The Depository Trust and Clearing Corporation is working with several high-performance layer-1 blockchains to move complex corporate actions, such as dividend payments and tender offers, onchain.
- DTCC, which processes about $20 trillion in U.S. securities trades daily, plans to begin testing its tokenized securities platform in July with a broader rollout targeted for October.
- DTCC CEO Frank La Salla said tokenized collateral and real-time dollar liquidity could be blockchain’s first major institutional use case, but warned that scalability, liquidity fragmentation and the loss of netting efficiencies remain significant challenges.
“We are working with some very good L1s right now, who are focused on the ability to process at faster rates, have higher resiliency,” he said.
Currently, the bottleneck is that on most blockchain networks could take a few days to process corporate actions, he pointed out.
“We process millions of dividend payments a day to feed to the industry,” Le Salla said. “We need high-performance L1s to do that.”
DTCC sits at the center of U.S. capital markets infrastructure, processing roughly $20 trillion in Treasury and corporate securities trades each day. The clearinghouse has spent nearly a decade exploring blockchain applications, but La Salla said the technology only became commercially meaningful once real-world use cases began to emerge in the pst few years.
