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The Depository Trust & Clearing Corporation (DTCC) announced on October 16 the results of a study which showed that distributed ledger technology (DLT) is capable of supporting more than 100 million trades per day. DTCC is an American post-trade financial services company providing clearing and settlement services to financial markets.
The Study and its findings
The study was conducted by leading global professional services company, Accenture with the support of Digital Asset (DA), a technology service provider, and R3, a distributed database technology company. The study demonstrated that DLT can cope with daily trade volumes, even at peak rates such as 115 million daily trades or 6300 trades per second.
This is a major step in the right direction, meaning for the first time blockchain supporting cryptocurrencies can operate at such a large scale, previously only being able to handle up to double-digit figures in a day. However, there is still work to be done to prove DLT is fit for purpose in terms of overall security, resilience and that it meets both the operational needs and regulatory requirements needed of it. We expect more tests to be done to determine the answer to these common technology concerns.
The main objective of the study was to test DLT’s ability to process huge amounts of trading data on the US equities market, so more tests would need to be done to see how DLT handles different platforms. For the testing, Accenture used a cloud-based testing instance and built over 170 nodes to replicate market functions such as exchanges, market participants and broker/dealers.
Accenture’s Global Blockchain Lead, David Treat said: “This project answered key questions and built serious confidence in blockchain’s ability to drive large-scale transformation.”
More about DTCC
DTCC is the premier post-trade market infrastructure for the global financial services industry and has 45 years’ experience in the area. They have offices in 16 countries and operate data centers and facilities and aim to standardize the processing of financial transactions. In a statement on the topic DTCC Director of IT Architecture, Rob Palatnick said: “DTCC has been actively involved in DLT projects for over 3 years and during that time, we have seen technology platforms continue to mature, but concerns have loomed around the scalability of DLT”.
The coming months and years will reveal just how feasible DTC is for supporting financial services markets, and we expect to see continued development in this area.