Proof of concept first to integrate cash and assets to enable settlement on distributed ledger technology
Payments Canada, the Bank of Canada, TMX Group and Accenture have demonstrated that the instantaneous clearing and settlement of securities on-ledger is feasible, showing for the first time that both central bank cash and assets can be tokenized to complete an instant, end-to-end equity settlement on distributed ledger technology (DLT).
Project Jasper is a collaborative research initiative between Payments Canada, the Bank of Canada and TMX group to experiment with an integrated securities and payment settlement platform based on DLT. Jasper III, a continuation of previous work launched in March 2016, is a proof of concept that was delivered by Accenture, leveraging R3’s Corda DLT platform. It explores the impact and potential benefits of DLT on broader Canadian financial market infrastructure.
“This proof of concept shows that it is possible to deliver payments in a way that has never been done before – by directly swapping cash from buyers to sellers, resulting in instant settlements,” said Gerry Gaetz, President and CEO of Payments Canada.
Previous phases of Project Jasper focused on the clearing and settlement of high-value interbank cash payments using DLT. Phase III explores an integrated payments and securities infrastructure. The proof of concept allowed clearing and “delivery versus payment” settlement immediately, demonstrating that it’s possible to complete post-trade settlement on a DLT platform. The ability to settle transactions immediately significantly reduces counterparty risk and frees up collateral.
Jasper III is currently the only proof of concept that maintains privacy for market participants and their transactions by giving only the parties involved in specific transactions the ability to view the transaction history, without providing the same visibility to other participants on-ledger.
John Velissarios, Accenture’s Blockchain Technology & Security Lead, said: “Project Jasper positions Canada as a leading innovator, the first to fuse assets and fiat currency on ledger, which is fundamental to moving towards production. Canada is the first developed market to focus on a full-cycle, on-ledger, trade-settlement system ― laying the groundwork for the Canadian financial market infrastructure to collaborate with similarly positioned global partners to derive new, mutually beneficial opportunities and benefits of DLT.”