Smart contracts are a next phase of development in Distributed Ledger and blockchain technologies. They present an opportunity to automate currently manual processes and move algorithms that run on legacy technology to a more efficient platform.
Smart contracts: the idea conjures various notions of flash crashes, robots taking over the world and a loss of human control. While smart contracts on Distributed Ledger Technology (DLT)/blockchain have some elements of these fantasies, they are more realistically part of a new opportunity that requires careful consideration for whether, how, and where they can improve business functionality for market participants.
In this report, we surveyed 11 vendors of smart contract technologies and solutions to understand the products, services and opportunities around their offerings. Our conversations revealed the excitement around smart contracts and also the hurdles that these new companies face to build momentum. We found several consistent themes and strategies across the firms that suggest winners will emerge in the capital markets industry, but not without hard-won lessons in how smart contracts can matter for users.
This report should be read by technology managers at capital markets firms, including banks, exchanges, CCPs, CSDs and asset managers. As industry participants are challenged by additional technological change and new options, this report helps sift through data and qualitative information to answer the critical question: do smart contracts help solve true business problems?
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