Always at the cutting-edge of innovation and keen to capitalise on the opportunities presented by blockchain technology in order to better serve its clients, CACEIS has chosen to participate in several public and private initiatives.
For more than a year, CACEIS has been participating in several projects intended to improve the effectiveness and increase transparency in asset management by using blockchain functions. This technology is based on a virtual ledger of data distributed and shared among multiple parties.
Until recently, the projects essentially consisted in producing proofs of concept (PoCs). With the French Labchain initiative, under the aegis of the Caisse des Dépôts, PoCs are being developed in the areas of digital identity, collateral management, SFTR reports, life insurance and cryptocurrency funds. In Luxembourg, the Scorechain initiative took the form of a PoC developed around the transfer agent activity.
“The initiatives and associations in which CACEIS is participating now increasingly seek to implement concrete solutions using blockchain technology,” notes Nathalie Poux-Guillaume, Head of Transformation and Innovation at CACEIS.
CACEIS has participated in the first successful blockchain-powered fund distribution transactions by Natixis Asset Management. In early July 2017, the management company announced that investors could subscribe to units in its funds via the FundsDLT platform, which is the result of collaboration between Fundsquare (subsidiary of the Luxembourg Stock Exchange), InTech (subsidiary of the POST group) and KPMG Luxembourg. For the first time in the history of asset management, investors were able to enter orders using the FundsDLT mobile application. The orders were then processed by the FundsDLT platform, which simultaneously routed them to the management company and CACEIS, acting as transfer agent. Once an order was accepted and valued by CACEIS, FundsDLT finalised the transaction by initiating the cash transfer from the investor’s account to the fund’s account and recorded the ownership of the units subscribed by the investor in the blockchain. This successful implementation paves the way for a new infrastructure model for the entire fund distribution industry.
In July, CACEIS announced the creation of the European FinTech LiquidShare with the support of Paris EUROPLACE. The result of a partnership announced in June 2016 by its shareholders (which include CACEIS and several other banks and market infrastructures, such as Euronext), this initiative will develop a post-market blockchain infrastructure to optimise access for small and medium-sized enterprises to capital markets.
In the long term, the solution will make it possible to significantly streamline the post-trade operations chain, by ensuring and facilitating the consolidation of securities registers, while enabling fast settlement delivery timeframes (T+0). The project’s first operating results are expected in 2019.
Finally, CACEIS has announced that it has teamed up with Eiffel Investment Group, the firms Gide and PwC and the Paymium platform to create the French Association for the Management of Cryptocurrencies (Association Française pour la Gestion des Cybermonnaies – AFGC). Given the proliferation of cryptocurrencies in circulation and the growing interest from all types of investors, CACEIS wishes to contribute to the sustainable development of cryptocurrency investment, by entering into a dialogue with cryptocurrency investors, financial management professionals, public authorities and cryptocurrency development stakeholders about the opportunities and challenges such investments present.
CACEIS recently set up a team dedicated to new technologies, including blockchain technology. This team, led by Nathalie Poux-Guillaume, is responsible for monitoring technological developments more closely and liaising with supervisory authorities about the legal and regulatory aspects that still need to be defined.