Blockchain

Deutsche Bank and STACS Complete PoC for Digital Assets and ESG Bonds

Deutsche Bank’s Securities Services in Singapore and Hashstacs (STACS) announced the completion of their proof-of-concept (POC) referred to as Project Benja on the use of distributed ledger technology (DLT) for digital assets and sustainability-linked digital bonds.

Set in the context of tokenised securities in the securities market, the teams worked on digital assets interoperability across platforms and related custody, digital securities and cash delivery-versus-payment practice, DLT to traditional systems connectivity, operating model evolution and smart contract templates including those involving sustainability-linked digital bonds.

STACS, in collaboration with Deutsche Bank Securities Services, was awarded the POC grant on 29 October 2020, which provides funding support for experimentation, development and dissemination of nascent innovative technologies in the financial services sector.

The POC grant is part of the Financial Sector Technology and Innovation (FSTI) scheme under the Financial Sector Development Fund administered by the Monetary Authority of Singapore (MAS).

Deutsche Bank’s domain expertise and the respective teams’ technical designs were combined with STACS’ live DLT platform which allows for end-to-end bonds lifecycle management.

The POC’s results were subsequently tested with industry participants; UBS, Malaysia’s national stock exchange Bursa Malaysia, and Union Bank of the Philippines (UnionBank) whose perspectives enriched the POC with more holistic assessments.

Through their involvement, Deutsche Bank and STACS were able to remodel and optimise the workflows involved to create a “Bond in a Box” DLT platform, unlocking new efficiencies with rapid smart contracts issuances, tested integration with payment modes like UBIN and Diem (Libra), digital custody and asset servicing, and Environmental, Social, and Governance (ESG) financing transparency needs.

Kamran Khan

Kamran Khan, APAC Head of ESG at Deutsche Bank, said:

“Data transparency, reliability and security are corner stones of the emerging ESG capital market. This cutting-edge ‘bond in a box’ POC successfully explored the synergies between Fintech and ESG, using distributed ledger and smart contracts capabilities with cross-platform interoperability for ESG-compliant digital securities.”

Benjamin Soh

Benjamin Soh, Managing Director at STACS, said:

“We are excited to have taken the first step towards turning a proof-of-concept to a proof-of-commercialization, through our collaboration with Deutsche Bank, and with other leading financial industry participants.

In addition, with the world’s focus turning towards ESG and sustainability, we look forward to expanding our network’s efforts in the sustainability push of the next few decades, via DLT technology as the common technology infrastructural nexus.”

Featured image: edited from Unsplash