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Almost one-third of industry now live with DLT , finds securities services association
Digital asset adoption rose four-fold in 2022 , according to the International Securities Services Association .
New research from the International Securities Services Association has pinpointed a major uptick in the usage of distributed ledger technology ( DLT ) over the past 12 months with almost one-third of the industry now using the technology in live production . According to the association , a further 31 % are in the building phase with DLT , 16 % are conducting pilots , while only 21 % consider themselves at the research level . The survey polled 148 organisations across the investmentcycle globally , including custodians , CSDs and exchanges . With almost one-third live in production with DLT projects , this represents a four-fold increase from the same survey in 2021 . ISSA put this down to demand by organisations implementing capabilities to support crypto currencies and tokenised bonds . The third annual version of the survey – run in partnership with the ValueExchange – also highlighted a move away from experimentation with DLT to a focus on commercialisation in 2022 , with 53 % of projects now intended for live , commercial usage . “ Whilst that commercialisation manifests itself differently in each sector of the market , the majority of projects are focused on facilitating new product launches and internal efficiencies today – more than on creating market-wide efficiencies ,” the report noted . Looking ahead , ISSA said that while there is still focus on crypto , market participants are additionally focusing and launching solutions to tokenise a growing number of asset classes in the near future – with securitised assets , private equity and listed equities all set to grow significantly in usage and importance . The research also pointed to a continuing reduction in the volume of blocking obstacles that organisations face in deploying DLT – falling from 31 % in 2020 to 16 % today . “ DLT is clearly starting to deliver real results for the industry today and tokenising highly paper-based assets – such as securitised assets , mutual funds and private debt – is clearly yielding positive returns in 2022 ” commented Colin Parry , CEO of ISSA . “ Whilst performance against expectations may lag for securities that have already been dematerialised , the outlook for growing DLT-driven efficiencies in 2023 is clearly positive .”
12 Global Custodian Fall 2022