Northern Trust partnered with IBM to launch a distributed ledger, or blockchain, solution for a private equity client.
The solution, based on open source Linux Foundation Hyperledger Fabric, is currently in use for the administration of a private equity fund managed by Switzerland-based asset manager Unigestion (which has $20 billion in assets under management).
The blockchain administration network provides real-time access to all parties, including fund managers, investors and regulators as required, Northern Trust said in a statement.
“[Northern Trust] anticipates substantial opportunities to bring improvements to the private equity market by using blockchain technology”, the company’s global head of market advocacy and research Justin Chapman said.
“This is an important first step to connecting participants much more effectively, including investors, managers, administrators, regulators, advisers and auditors,” Mr Chapman said.
“The blockchain solution allows the fund to transfer ownership stakes and be managed, serviced and audited throughout the investment life cycle on a transparent platform offering “one version of the truth” to participants who gain access via secured means,” Northern Trust said.
“Initially, Northern Trust will make the solution available to clients on a selective basis.”