Eurex Clearing has successfully tested the settlement of cash over a distributed ledger operated by the Banque de France.
These tests are part of the Eurosystem’s exploratory work on innovative technologies for wholesale central bank money settlement. The testing took place at Deutsche Börse Group’s headquarters and involved collaboration with the German Bundesbank, Dutch De Nederlandsche Bank, and Banque Centrale de Luxembourg. The focus was on two main use cases: centrally cleared repo transactions and intraday margin calls. The tests utilized a native digital commercial paper issued by ABN Amro on Clearstream’s D7 platform and traded on the Eurex Repo F7 platform.
Eurex stated, “This marks the first time that Eurex Clearing has managed its own wallet on a Eurosystem’s DLT technology.”
The clearing house reported that the tests clearly demonstrated that counterparty credit risk remains unchanged, irrespective of the underlying technology. This finding emphasizes that transitioning to distributed ledger technology does not inherently alter the risk profile associated with counterparties.
Claudine Hurman, director of infrastructures, innovation, and financial markets at Banque de France, highlighted the importance of collaboration with Deutsche Börse Group, Eurex Clearing, Eurex Repo, and Clearstream. She noted that these trials are crucial for ensuring that solutions meet the diverse needs of stakeholders and play a vital role in integrating distributed ledger technology into financial market infrastructures, thus paving the way for the future of digital finance.