Post-trade

Reconciliation
and Reporting

Asset Servicing includes daily valuation, margin calls and ensuring timely settlements. Custodians continue to hold the underlying assets and manage their safekeeping.

Use Cases

We are focusing our efforts on solving six market-validated primary use cases. Together they address critical challenges in the market.

Automating Settlement Processes
Automating Reporting
Use case 05

Automating
settlement processes

Transitioning settlement from T+2 to near real-time (T+0) reduces operational and settlement risks, and offers the potential to lower capital costs through more efficient asset utilisation.

Problem

Transferring beneficial ownership of assets through Free of Payment (FOP) or Delivery versus Payment (DvP) is fundamental to all financial activity. The current settlement model, reliant on SWIFT infrastructure, operates on a two-day settlement cycle. This exposes market participants to credit risk from potential settlement failures, necessitating that firms maintain excess capital as a buffer against default and settlement failure.

Who Benefits
  • 1.

    Primary
    C-level or Head of Trading, Back Office and Product
  • 2.

    Secondary
    Compliance
Trading parties of all types
Transfer
Agents
Pension
Funds
Banks

Brokers/IDBs
Modules
Console
API
Entity Set-up
Blockchain Services
Tokenisation
CDM
Rules & Event Engine
Solution

The Tokenovate Platform autonomously manages the conditions and rules associated with DvP/FOP settlements using smart contracts tailored to meet the specific needs of platform users while at the same time complying with industry and regulatory standards. These smart contracts ensure secure and risk-free transfer of full or partial beneficial ownership between parties, adhering to all legal and regulatory requirements, including the necessary affirmation and confirmation messaging exchanges between counterparties.

The platform’s technology facilitates the tokenisation of numerous real-world assets, enabling FOP asset movements for collateral management in OTC derivative trading and ensuring DvP settlements for transactions involving VCC token purchases and sales.

All settlement activities are verified and time stamped by both parties as they are recorded on the blockchain. This activity is accessible through the platform Console, with data maintained in the private ledger accounts of each participating entity.

Use case 06

Automating reporting

Complete and accurately formatted digital regulatory reporting is automatically generated from a golden record of a trade’s metadata, which is stored immutably on a public blockchain.

Problem

Regulatory reporting, involving various activities and multiple regulators, is often a significant challenge for the financial industry. The initial step of aggregating complete and accurate data from disparate systems is followed by the need to reformat this data to comply with specific reporting templates. Inefficiencies arise from the frequent need for manual intervention to check and reconcile the data before submission.

Who Benefits
  • 1.

    Primary
    C-level or Head of Trading and Product
  • 2.

    Secondary
    Compliance
Principals
Fund
Managers
Hedge Fund Managers
Banks

Brokers/IDBs
Clearing Banks
Modules
Console
API
Entity Set-up
Blockchain Services
Tokenisation
CDM
Rules & Event Engine
Solution

The Tokenovate platform integrates the ISDA CDM with its Digital Regulatory Reporting (DRR) modules. As trades are captured, processed and maintained automatically through their lifecycle using smart contracts, each business and economic event, along with its data, is recorded as transactions on the blockchain in a UTXO. 

Access to this comprehensive and accurate data enables automated assembly of the data elements necessary for reporting in the DRR format to relevant Trade Repositories and market participants via APIs and the Tokenovate Console.