Wall Street Giant DTCC Launches Private Blockchain in Big Crypto-Milestone for TradFi

Project Ion is now processing an average of over 100,000 equity transactions a day using distributed ledger technology.

AccessTimeIconAug 22, 2022 at 1:15 p.m. UTC
Updated May 11, 2023 at 4:16 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Depository Trust & Clearing Corp. (DTCC) is a quiet giant on Wall Street, processing basically every trade in the more than $40 trillion U.S. stock market.

It just officially joined the crypto-revolution, announcing Monday that it began live testing of a private blockchain to see whether it's up to the challenge of clearing and settling transactions in the world's largest equities market. The Project Ion platform now processes more than 100,000 trades per day on average, and almost 160,000 on peak days.

  • How NEAR Enables Multichain Access From One Account
    00:56
    How NEAR Enables Multichain Access From One Account
  • Why the NEAR foundation Chose Eigenlayer as a Security Partner
    00:54
    Why the NEAR foundation Chose Eigenlayer as a Security Partner
  • Judge Kaplan Had 'No Love' for Sam Bankman-Fried, Legal Expert Says
    07:08
    Judge Kaplan Had 'No Love' for Sam Bankman-Fried, Legal Expert Says
  • How Bitcoin and Ether's Options Contracts Combined Expiry Could Spike Volatility
    01:11
    How Bitcoin and Ether's Options Contracts Combined Expiry Could Spike Volatility
  • That's a drop in the bucket for an industry that measures daily volume in billions of shares, but it's also one of the biggest milestones yet in traditional finance's years-long march toward embracing the ledger technology underpinning bitcoin (BTC) and the rest of the cryptocurrency ecosystem. Project Ion was launched as a pilot program in 2020 and moved into a development program in September.

    Settling stock trades in the U.S. currently takes two days, a glacial pace compared with cryptocurrencies. That relative sluggishness stands out in an era when stock trades are often get measured in billionths-of-a-second time scales. During feverish trading of meme stocks early last year, Robinhood restricted trades in some of them because of a $3 billion collateral request from DTCC, which stockpiles money as a safeguard in case something bad happens during the two days it's processing a trade.

    The U.S. Securities and Exchange Commission (SEC) has proposed speeding up stock settlement times to something called T+0 – jargon for processing trades the same day they're executed. Last year, Robinhood (HOOD) CEO Vlad Tenev said that T+0 would've prevented volatile markets like those seen with meme-trader favorites GameStop (GME) and AMC (AMC).

    Major Wall Street players have for years been experimenting with blockchains. The former president of the New York Stock Exchange told the Wall Street Journal in a story published Monday that "blockchain technology is going to rewire all financial services."

    DTCC said its conventional system for processing trades remains in effect; trades on its private blockchain are being handled in parallel.

    The DTCC project, which is private and permissioned unlike many traditional blockchain networks such as Bitcoin and Ethereum, is being developed with firms including Barclays (BCS), BNY Mellon (BK), Charles Schwab (SCHW), Citadel Securities, Citigroup (C) and Credit Suisse (CS). DTCC partnered with software provider R3 to launch Project Ion using R3's Corda distributed ledger technology (DLT) software.

    "Digitized assets and emerging technology like DLT are shaping and evolving the financial services landscape, and we remain committed to advancing innovative solutions that capitalize on opportunities, deliver new value and drive the industry forward," said Murray Pozmanter, managing director and president of DTCC Clearing Agency Services.

    UPDATE (August 22, 15:46 UTC): Updated with additional context throughout.

    UPDATE (August 23, 19:17 UTC): Updated with additional context throughout.

    Disclosure

    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

    Oliver Knight

    Oliver Knight is a CoinDesk reporter based between London and Lisbon. He does not own any crypto.


    Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.