The blockchain communication project will see the company trial a blockchain solution that drives efficiencies in communicating significant corporate events, with American Century Investments, Citi, Vanguard and Northern Trust
SWIFT and Symbiont Blockchain enterprise platform have partnered to pilot a project to automate communications for public traded companies.
The blockchain communication project will see the company trial a blockchain solution that drives efficiencies in communicating significant corporate events, with American Century Investments, Citi, Vanguard and Northern Trust.
These communication events include dividend payments, exchange offers, mergers, Dutch auctions or other corporate actions which need to be quickly shared with investors, creditors and all other key stakeholders.
Due to the number of intermediaries which include central securities depositories (CSDs), local and global custodians, fund managers, and paying agents, the process is further complicated. All these make up the investment chain. Each has to pass on information about the event and, because they follow different data standards, may communicate about it slightly differently.
Manual activities such as data cleansing, formatting and interpretation account for 30 per cent of the costs involved in processing corporate actions, delivering a solution with accurate corporate action in real-time would resolve much of the costs, according to the company.
To create a network effect that leverages the 11,000+ institutions connected to SWIFT globally, SWIFT is trialling Symbiont’s proprietary technology platform, Assembly, using its smart contracts and blockchain capabilities.
Tom Zschach, Chief Innovation Officer, SWIFT, said, “By bringing Symbiont’s Assembly and smart contracts together with SWIFT’s extensive network, we’re able to automatically harmonise data from multiple sources of a corporate action event. This can lead to significant efficiencies. Corporate action data from SWIFT messages is translated by the SWIFT Translator and uploaded in Symbiont’s blockchain. Their smart contract technology can then compare information shared between participants and flag discrepancies, contradictions or inconsistencies across custodians.”
Symbiont’s private blockchain solution enables pilot participants to unlock numerous opportunities. Most notably, Symbiont’s Assembly platform supports greater transparency through the creation of a single unalterable record, which provides a digital audit trail, privacy, versatility and the delivery of key statistical data.
Leading to further back-office savings, the solution also has the potential to allow asset managers and custodians to automate how they compare corporate action information sent to them from multiple sources.
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