As a minimum viable product, the solution will be integrated with several other systems currently managed by SIX Swiss Exchange and will take advantage of the distributed ledger technology capabilities at the core of the Nasdaq Financial Framework technology stack.
According to Nasdaq, the technology for OTC derivatives will help SIX Swiss Exchange gain first-hand experience of initiating a blockchain solution, while also learning how best to leverage it in a post-trade environment.
Nasdaq and SIX Swiss Exchange extended their current technology contract in October 2016. That agreement includes trading technology for SIX equities, exchange-traded funds, fixed income and fund markets, as well as the SMARTS Surveillance platform, which is now used by 47 marketplaces, most recently the Nigerian Stock Exchange.
Chris Landis, division CEO of SIX Swiss Exchange, said: “We are always keen to explore innovative technologies which could serve as basis for wider commercial offering. Working together with Nasdaq reinforces our commitment towards being an exchange at the technology forefront.”
Lars Ottersgård, executive vice president and head of market technology at Nasdaq, commented: “Nasdaq is a strong believer in the power of emerging technologies to transform financial markets.”
“This project with SIX Swiss Exchange, one of our long-term partners, is a prime opportunity to explore and implement blockchain technology in a controlled, highly collaborative environment.”
Research by Broadridge and Bain & Company released earlier this year found that more than 80 percent of financial market executives interviewed expect the impact of blockchain to be “transformative” in the coming years, and to be adopted by most financial institutions by 2020.
This change was also reflected in a study of Google News searches, monitored within the first 50 days of 2017. It reported that from January, more than 54,000 news stories were published mentioning blockchain or distributed ledger technology.