Today Vanguard announced it completed the first pilot for an asset backed securities (ABS) solution developed with Symbiont. Also involved were BNY Mellon, Citi, State Street and a “large ABS issuer” in the banking sector. Vanguard had almost $6.2 trillion in assets under management as of January this year.
Asset backed securities are seen as a good match for blockchain because, by definition, there is a bundle of underlying assets that historically can seem rather opaque. That’s something that earned mortgage backed securities a bad name during the 2008 financial crisis.
Blockchain helps to provide some level of transparency. Take the example of an ABS of credit card debt. There’s likely to be a database that tracks the payments made by the cardholders. Potentially on a regular basis, a smart contract could pull in that information and show the proportion of debt that is up to date with payments.
Article continues …
Want the full story? Pro subscribers get complete articles, exclusive industry analysis, and early access to legislative updates that keep you ahead of the competition. Join the professionals who are choosing deeper insights over surface level news.
