Derivatives are fertile territory for the application of smart contracts and distributed ledger technology (DLT) because their main payments and deliveries are heavily dependent on conditional logic. However, these technologies are at a relatively early stage of development and there is still a lack of agreement on what a smart contract is, what role these technologies can play in the derivatives market, and how these technologies might interact with existing legal standards and documentation.
ISDA published guidelines to explain the core principles of ISDA documentation and raise awareness of the important legal terms that should be maintained when a technology solution is applied to derivatives trading.