Hyperledger has launched a Special Interest Group ("SIG"), the Hyperledger Capital Markets SIG, to facilitate focused technical and business-level conversations related to appropriate use cases for blockchain technology across Capital Markets.
SIGs gather community members from an industry segment to work on domain-specific problems and create an environment for open discussion, document co-creation and solution proposals. Hyperledger now has eight SIGs, including ones focused on healthcare, telecom, trade finance, supply chain and social impact.
Capital Markets are a way to connect investors and borrowers. Borrowers get access to capital and investors get returns from their investment. These returns can be in the form of dividends, coupon payments or appreciation of the instruments. The downside risk is default by the borrowers as well as the reduction in the price of instruments. Borrowers are enterprises or governments. Investors are individuals or public and private institutions. Capital markets are an important component of the economy. Capital markets include the bond market (the largest market) and the stock market. It can also include derivatives.
When invented, the Blockchain was aimed at global uncensored retail payments through the medium of a digital currency. The original solution has since evolved into a store of value and its exchange among participants in a safe, secure and transparent manner. Many Blockchain solutions have been created to cover issuance and transfer of digital assets, futures and other derivatives. This and other solutions feature capital markets infrastructure and processes.
The Cambrian explosion of Blockchain solutions includes public permissionless to private permissioned. Many of these solutions are in the capital markets sector. Hyperledger houses the most diverse set of primary blockchain frameworks, utilities and libraries. The new SIG helps unify thinking and solutions targeted to capital markets in Hyperledger. In the spirit of the SIG, the CM-SIG is a forum where capital markets business experts and blockchain technical folks come together in a free and open-source manner.
The scope of the Hyperledger capital markets SIG:
- Draw out front to back taxonomy for generic capital market infrastructure with variations on specific product lines
- Impact of dlts and their place in the architecture (business, integration, infrastructure, regulation, market events, interaction between product lines)
- Risk calculation and scenario analysis: analytical impact of Distributed Ledger Technologies ("DLTs") in pre-market, trading, hedging, day-to-day risk management, trading limits, FRTB,
- Specific use cases, current pilots and proofs of concept, and production case studies with opportunities and risk; as well as solutions for the identified problems
- Cross-cutting architectural principles, performance and scalability, security, identity management, off-chain data, deployment and operation in regulated enterprises;
- Standards in capital markets for data in flight and at rest, events and responses, privacy in light of DLTs
- Conferences or meetups to connect face to face, submit papers, talks, presentations
- Interface with companion SIGs like Trade Finance or Supply Chain to draw out common areas of concern and interactivity of solutions
- Functional knowledge drawn from SIGs like telecom, best practices from Social Impact SIG (SISIG) as well as the knowledge drawn from Architecture, Identity and Performance and Scale Working Groups
The new Hyperledger Capital Markets SIG, is led by the chair Vipin Bharathan, Founder dlt.nyc, a blockchain consulting firm, and vice chair Natalia Garcia, Assistant Director in Debt Capital Markets, and is comprised of more than 21 founding individuals from different locations, from diverse financial institutions. SIG membership and participation has grown since and is open to all. We have already had several audio calls and are involved in some projects that the community has found interesting.
The projects that we are currently engaged on are:
- Taxonomy, classifying the dimensions of capital markets,
- Standards covering the different types of products
- Use cases, listing the prominent use cases- a draft taxonomy of use cases is available
- Challenges or obstacles that are common to DLTs and their application to capital markets use cases
- Regulations that apply to the various aspects of this highly regulated industry
- ROI of any particular solution, especially on intangible aspects like trust, transparency and decentralization in capital markets
Greater details on any one of these can be found through our projects page.
CMSIG is aimed at working together discovering correlation between these projects to deploy actual solutions from the Hyperledger greenhouse inside capital markets.
You are welcome to volunteer for any of the existing projects. We also welcome new projects, especially if they are presented before the community and have a group of committed volunteers backing them.
Each SIG has an open e-mail list, a Chat channel, and a wiki page. Live meetings are also held regularly via web teleconference. When needed, a task force can also be created within the SIG and have working sessions to discuss specific work items.
If you’re interested in joining the Capital Markets SIG, please subscribe to the mailing list and join the Chat channel where meeting details will be announced. The wiki page of the SIG contains links to resources, findings, meeting minutes, project details and the active member directory. Find a list of all community meetings including the Capital Markets SIG on the Hyperledger Community calendar. We look forward to your active participation and valuable contributions.