LONDON, May 20, 2019 /PRNewswire/ --
- Calastone has successfully launched its blockchain-enabled Distributed Market Infrastructure (DMI)
- The migration sees the largest group of financial services organisations ever to connect and transact on a live distributed ledger
- The entire global funds network of more than 1,800 customers across 41 countries and territories have been migrated onto the blockchain-based network
- The DMI enables friction-free trading, stripping out cost, risk and operational inefficiencies
Calastone, the largest global funds transaction network, today announces the successful go-live of its blockchain Distributed Market Infrastructure (DMI).
The technology underpinning Calastone's network has now been migrated to a blockchain-enabled market infrastructure. The migration of Calastone's global network of more than 1,800 customers across 41 markets is a world-first and represents the largest community of global financial services organisations connecting and transacting via distributed ledger technology.
Less than two years since Calastone announced the completion of its first phase to test the feasibility of using blockchain to develop a common global marketplace for the trading and settlement of funds, the company's DMI is today live. This represents a major step in enabling digitalisation and friction-free trading at a significant global scale. Calastone has highlighted the scale of tangible value the DMI could bring to the industry, forecasting more than £3.4bn in savings per year for the mutual funds market worldwide, achieved through the technological mutualisation of the distribution model.
Financial services organisations around the world – whichever size and scale – can, through the DMI, now access a fully mutualised global funds marketplace whereby the trading, settlement and servicing of funds is conducted in real-time. This will play a key role in stripping out the ever-increasing costs, operational burdens and risks inherent within the current model.
Campbell Brierley, Calastone's Chief Innovation Officer, comments:
"Developing the DMI has been a fulfilling journey of innovation and it is incredibly exciting to have completed a world first for the financial services sector. Over 1,800 clients across 41 markets are now transacting on the DMI, transforming how fund organisations interact with one another.
"Through Calastone's blockchain-enabled market infrastructure all participants across the fund's world can work together seamlessly and view trading activity in real-time. Information now ripples instantly across the market, a step change from the previous, fragmented model. Financial services firms worldwide can, via the DMI, utilise new services, enhanced capabilities and new investment opportunities, allowing them to evolve their proposition to one that will be more competitive and valuable long-term."
At launch, the DMI immediately solves several key points of friction which are fully automated and visible as all participants are connected into a common infrastructure. It will also bring a new service, the Sub-Register, which creates a shared, real-time view and history of the registers between trading partners at any point in the distribution chain.
Julien Hammerson, Calastone's Chief Executive Officer, adds:
"Since we launched in 2008, our vision has been to use innovative technology to create a friction-free funds market and reduce the overall cost of trading for all market participants. Today more than ever, investors expect increased returns, greater access and transparency, at a time when the funds industry feels the effect of growing cost pressures.
"The launch of the DMI today marks an important step for the entire funds industry, creating a friction-free global marketplace for funds. By leveraging the latest technology we are able to provide the investment management community with the tools they need to control risk and cost, while meeting the evolving needs of investors."
In the lead up to the go-live, Calastone has been engaged with a community of early adopters who have had access to the technology, including RBC Investor & Treasury Services, Bravura Solutions, Seven Investment Management, Multrees and Tilney Investment Management.
Calastone is the largest global funds transaction network, connecting many of the world's leading financial organisations. Our mission is to make funds accessible to everyone by reducing the frictional cost of trading. We use smart technology solutions and industry collaboration to lower operational risk and enhance client profitability through digitisation and automation.
Over 1,800 customers in 41 countries and territories benefit from Calastone's services, processing over 9 million messages and £170 billion of transactions each month.
Calastone is headquartered in London and has offices in Luxembourg, Hong Kong, Taiwan, Singapore and Sydney.
*Calastone has calculated the potential cost savings of moving to a distributed and mutualised market infrastructure using data from Deloitte's study "Europe's fund expenses at a crossroads; The benefits of mutualizing the cost of distribution," alongside data from the 2018 Investment Company Fact Book. Calastone's calculation has been applied to mutual fund assets under management for the global funds market, excluding the USA.
For more information, please contact:
FTI Consulting LLP
Ollie Bailey-Pratt / Darius Alexander