Yesterday Bloomberg reported that the Bank of America has joined the blockchain stock settlement network from Paxos Trust. It’s the fourth big bank to pilot the solution, following in the footsteps of Nomura’s Instinet, Credit Suisse and Societe Generale.
In April, Instinet and Credit Suisse announced they had executed same-day settlement using the permissioned blockchain solution. Typically with DTCC Same-Day Settlement, the transaction has to happen before 11.30 am, which only accounts for a fraction of trades.
“We then can free up the collateral we’d have to post on an overnight basis,” said Kevin McCarthy, the Head of Financing and Clearing at Bank of America. “The return-on-assets in this business would improve, which has been a challenge.”
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