Clearstream, ABN AMRO Bank, ABN AMRO Clearing, Rabobank, Eurex Clearing and Eurex Repo have jointly processed a set of cleared repo transactions using distributed-ledger technology (DLT). The transactions took place in the context of the European Central Bank (ECB) trials aimed at exploring the potential of DLT for settling wholesale transactions in central bank money.
ABN AMRO Bank acted as collateral taker/cash provider, ABN AMRO Clearing and Rabobank as collateral providers/cash takers, and Eurex Clearing as central counterparty whereas Eurex Repo was providing the trading platform. Clearstream acted as Market DLT Operator, providing the technical infrastructure with its digital securities platform D7 developed in strategic partnership with Google Cloud.
The first set of repos was processed intra-day, the second overnight. Basis for the repo transaction was a tokenized Eurobond/commercial paper issued earlier by ABN AMRO Bank, equally in the context of the ECB trials.
The processes entirely run on Clearstream’s D7 DLT platform. They include both the issuance of the security itself and the transfer of the assets from the issuer to the investors. Also, the movement of funds using digital central bank money is instructed and orchestrated by D7 DLT. By connecting D7 with Banque de France’s full-DLT interoperability solution DL3S, the cash leg of the repo transaction reaches the European TARGET2 payment system.
Jens Hachmeister, head of Issuer Services & New Digital Markets at Clearstream, said in a statement: “Managing a cleared repo as our 6th use case in the ECB trials complements Clearstream’s D7 DLT portfolio perfectly. We are thrilled to be working with such strong partners on a stable digital cash solution to advance a competitive digital financial ecosystem in Europe.”