One of the main functions of the new solution is the mechanism for covering losses of investors based on the DLT due to the triggering of margin calls (forced completion of the transaction, when the account balance necessary to maintain the amount of collateral of all open positions is near zero). This is reported in the press release.
It is also reported that Nasdaq will develop a Proof-of-concept, and EuroCCP and ABN AMRO Clearing will develop a client part of the user interface and will take over the integration of services. Euroclear, in turn, will ensure the settlement of security transfers, as well as control over compliance with regulatory requirements.
Currently, processing transactions with collateral on derivatives is carried out centrally, which creates certain risks and difficulties. According to the creators of the platform, because of the growing number of participants in the derivatives market, this segment of the financial market needs new, more efficient solutions. The latter, in particular, should help to optimize the management of collateral, as well as the interaction of market participants located in different time zones.