In June 2017, Calastone tested the feasibility of blockchain technology for creating a global marketplace for trading mutual funds and successfully carried out the first phase of its “distributed market infrastructure proof-of-concept”.
By migrating its network to infrastructure underpinned by blockchain in 2019, Calsatone plans to tackle challenges in the sector such as operational inefficiencies, cost and risk, regulatory pressures, and the inability to meet consumer demands.
Chief executive Julien Hammerson said Calastone’s vision was to reduce the costs of ownership by making it “friction-free” for market participants.
“Our services have introduced significant operational and cost efficiencies into the sector and as we scale our business for the future, we are ensuring we have the connectivity and technology to continue to service the increasingly sophisticated demands for efficiency, value and speed,” Mr Hammerson said.
He added that implementing blockchain technology would help customers be “future-ready”.
“We are delivering a solution that will not disrupt the current connectivity and interaction our customers have with our network, rather putting them in pole position to make the step change to the blockchain when timely and additive to their specific objectives and requirements,” Mr Hammerson said.
Calastone deputy chief executive Ken Tregidgo said introducing blockchain technology offered “significant potential for the future, for a friction-free and a more streamlined process for all counterparties worldwide”.
“Whilst the potential for long-term change is great, the migration path for customers to take advantage of the future infrastructure will remain seamless, enabling clients to move when they are ready,” Mr Tregidgo said.
“A blockchain-enabled marketplace means alleviating operational inefficiencies, increasing performance and generating greater savings – a win-win for everybody.”
Meeting the future needs of the industry would be a “long process”, he added.
“Though we’re thrilled to see the first stages of this come into effect and are excited about the opportunities it will bring,” Mr Tregidgo said.