Major Spanish stock market operator Bolsas y Mercados Españoles (BME) has completed its first blockchain pilot for electronic certificates of collateral pledges, according to an official press releasepublished on March 15.
Implemented along with Renta 4 Banco, which is the only investment services firm listed on the BME, the new pilot intends to eliminate the use of physical certifications by digitizing all processes and providing network participants with real-time access to data.
The pilot’s proof-of-concept (PoC) consisted of the release of collateral pledged by Renta 4 Banco to cover customer’s positions at BME Clearing, BME’s central counterparty.
According to the announcement, the implementation of the blockchain-powered pilot enabled the parties to reduce total processing time by more than 80 percent.
The PoC was developed by BME’s division DLT-Lab, which researches the use of blockchain for improving existing financial procedures in collaboration with regulators and various financial institutions. To develop the pilot, BME’s DLT-Lab worked with infrastructures involved in the process and the BME subsidiaries BME Clearing, the Spanish central securities depository Iberclear and Renta 4 Banco.
According to the press release, BME and Renta 4 Banco will keep working on the initiative in order to launch the new system officially by the end of 2019.
Berta Ares, Head of Digital Transformation at BME, emphasized that distributed ledger tech (DLT) allows the parties involved in the process to both reduce operating times and provide legal certainty for electronic certificates, while maintaining privacy and compliance.
Previously, BME participated in a joint blockchain tech project to record the issuance of financial warrants. The initiative involved eight major European financial institutions, including Spanish securities regulator the National Securities Market Commission, BBVA, BNP Paribas, CaixaBank and others.
In early February, Cointelegraph reported on Switzerland’s principal stock exchange SIX Swiss Exchange plans to test blockchain integration for its upcoming parallel digital trading platform SDX in the second half of 2019. The blockchain-powered platform intends to minimize trading risks, as well as to expand the scope of tradable titles.
Rhode Island is exploring blockchain technology to improve state operations
- The idea can only be initiated after the state approves the request for proposal (RFP).
- A technical evaluation committee will review the RFP.
Rhode Island has issued a request for proposals (RFP) to explore the possibility of blockchain technology incorporation for government use. Liz Tanner, Director of the Department of Business Regulation, stated that she believes that blockchain can bring modernization in the government and would make bureaucracy in the state more efficient. Apparently, they are not looking for specific solutions, but are just intrigued by its possibilities. A memo following the RFP states:
“Suggested areas of application… include antifraud, contracts, medical marijuana, records, notarization, registration and licensing, investigative evidence control and more.”
Brenna McCabe, director of public affairs for the Department of Administration in Rhode Island, told Government Technology that it will allure more bidders who are required to submit two proofs of concept for blockchain application. The idea can only be initiated after the state approves the RFP. The memo also states:
“With proofs of concept, [Rhode Island] can gain a better understanding of the maturity of blockchain technologies and platforms, as well as potential sustainability in state government operations.”
A technical evaluation committee composed of staff from various state agencies will review the RFP. However, McCabe admitted that they face significant hurdles from laws, regulations and licensing structures that would require changes to allow for blockchain use.
Government and financial regulators in Brazil exploring use of Blockchain
- Brazilian authorities are keen to adapt to new emerging technologies, such as blockchain.
- The Central Bank of Brazil, the Securities and Exchange Commission (CVM), the Superintendence of Private Insurance (SUSEP), and the Ministry of Economy’s Special Secretariat for Finance are working together
The government and financial authorities in Brazil are working on a project for the development of a regulatory sandbox type model. They are keen to target new technologies such as blockchain.
In terms of the authorities; the Central Bank of Brazil, the Securities and Exchange Commission (CVM), the Superintendence of Private Insurance (SUSEP), and the Ministry of Economy’s Special Secretariat for Finance are working together to ensure they adapt to tech such as blockchain, exploring how it is affecting the financial industries within the country.
The CVM detailed that the project implies that emerging technologies in the likes of; blockchain, robotics and AI have facilitated the establishment of new business models. They of which have been able to come up with new products and services of higher quality and scope.
Rhode Island Looks to Adopt Blockchain For Government Use
Rhode Island issued a request for proposals aimed at exploring the viability of blockchain technology to improve state operations. This comes on the heels the state relaxing certain security laws for blockchain businesses.
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Director of the Department of Business Regulation Liz Tanner said in a statement she believes blockchain represents the modernization of government and would enable bureaucratic efficiency in the state. She also said Rhode Island’s initiatives were inspired by the adoption of blockchain by overseas governments.
The request for proposals is not looking for specific answers to specific problems, but is keeping an open mind to the possibilities of the emerging technology. A memo following the RFP states, “Suggested areas of application… include antifraud, contracts, medical marijuana, records, notarization, registration and licensing, investigative evidence control and more.”
Brenna McCabe, director of public affairs for the Department of Administration in Rhode Island, told Government Technology that this long list of possible applications is meant to entice more bidders, all of whom are required to submit two proofs of concept for blockchain application.
McCabe said state officials did not want to stifle the ingenuity of the industry by limiting the scope of the RFP.
It’s only after the state receives proposals that they can conceive of what the technology offers. “With proofs of concept, [Rhode Island] can gain a better understanding of the maturity of blockchain technologies and platforms, as well as potential sustainability in state government operations,” the memo stated.
The proposals will be reviewed by a technical evaluation committee composed of staff from various state agencies. “The initial contract period is estimated to begin Aug. 13 for a time period determined by the winning bid(s),” according to the RFP.
Anticipated problems will stem from laws, regulations and licensing structures that would require changes to allow for blockchain use, said McCabe. Though state leaders will have a better idea of what needs to be tweaked once proposals are reviewed.