Deutsche Boerse and Bundesbank launch blockchain settlement prototype

Blockchain prototype is the first result of collaboration between the two firms.

Deutsche Boerse and Deutsche Bundesbank have teamed up to launch a functional blockchain prototype for the settlement of securities.

The prototype was designed to provide settlement of securities and securities transfers against both instant and delayed payment.

Both parties said they will continue to develop the prototype over the next few months to analyse its technical performance and scalability.

Carl-Ludwig Thiele, a member of Deutsche Bundesbank’s executive board, said the firm’s are working together to see if the blockchain technology can be used for financial transactions, and if so, how it can be achieved.

“The Deutsche Bundesbank hopes that this prototype will contribute to a better practical understanding of blockchain technology in order to assess its potential,” he added.

Carsten Kengeter, chief executive officer at Deutsche Boerse, said the exchange will continue to do its “utmost to leverage blockchain's efficiency potential and to better understand and minimise the associated risks of this technology.”

The prototype, however, is far from market ready and is purely a conceptual study, although both firms are looking to take the prototype into test concept.