We believe that there are numerous potential applications for distributed ledger technology (DLn in the financial lndustry as evldenced by leadlng financial players’ considerable investments in the area. As DLT ambitions to allow instantaneous settlement, lt seems unavoidable in the long term that its integration should significantly impact and reshape the post-trade landscape. One obvious area of research ls the impact of DLTon central clearing. Central clearing does have significant distributlonal consequences for collateral requlrements across market participants (Duffie, Scheicher and Vuillemey, 2015). As the use of blockchain technology should directly impact central clearing, it should ln tum Impact collateral requirements.
A second area of research is the integration of smart contracts for managing margin requirements, and more generally assessing the efficiency gain and overall risk reduction that market participants could expect from their introduction; this should be done by looking at every step of the post-trade value chain. Lastly, an overall area of research is the prospective analysis of how the post-trade landscape is likely to restructure itselfwith the growing introduction of DLT.