Deutsche Börse sets up DLT and crypto unit
Deutsche Börse is setting up a “DLT, Crypto Assets and New Market Structures” team as it steps up its interest in these technologies.
Along with the new unit, it has made an initial investment in HQLAx in exchange for a minority shareholding, strengthening ties with the firm for their securities lending market ambitions
The amount of capital invested, while undisclosed, has been confirmed to be in the “single-digit euro million amount”, and it says it is likely that the group will increase the hold shares before the end of the year.
These developments follow on from March, when Deutsche Börse announced that together with HQLAx it was building a securities lending solution using the R3 Corda blockchain platform.
Since then, the onboarding process with an initial set of banks has been kicked off and discussions with relevant regulatory authorities are taking place.
Philippe Seyll, co-CEO of Clearstream Banking, comments: “This collaboration will enable us to create a true blockchain-based solution in the post-trade arena. It will allow market participants to redistribute collateral liquidity more efficiently by improving interoperability for pools of securities residing in multiple, disparate settlement systems and locations.”
As part of the investment, Deutsche Börse also obtains two board seats at HQLAx, represented by Philippe Seyll, who is in charge of the group’s global securities financing business, and Jens Hachmeister, responsible for the development of blockchain initiatives across the group and will lead the new team dedicated to this area.
Hachmeister explains: “We see that several market offerings based on DLT/blockchain technology cut across the group’s value chain already, challenging our traditional market infrastructure – for example equity funding innovations through initial coin offerings (ICOs), decentralised secondary market platforms, or blockchain-based custody solutions just to name a few.”
DB1 Ventures, Deutsche Börse’s corporate venture capital arm, will manage the investment in HQLAx. This is the second blockchain investment made by DB1 Ventures.
Earlier this year, Deutsche Börse said it was cutting jobs to spend big on fintech with a €270 million funding plan to invest in blockchain, big data analyses, cloud computing, robotics and artificial intelligence (AI).
The group, alongside post-trade services provider Clearstream, said it was partnering with Germany’s figo and Luxembourg-based regtech start-up Finologee to create a fintech acceleration platform.
