US Clearinghouse DTCC Acquires Securrency to Boost Blockchain Initiatives

DTCC’s first purchase in 10 years could bolster its tokenization endeavors.

Depository Trust & Clearing Corp. (DTCC) has made a strategic move to purchase the startup, Securrency Inc, as a part of its ongoing commitment to embrace blockchain technology. The focus is on services such as the post-trade processing of tokenized assets.

The acquisition deal, amounting to around $50 million, will bring Securrency, headquartered in Annapolis, Maryland, under the DTCC umbrella. Those privy to the deal details have chosen to remain anonymous. Securrency’s state-of-the-art technology might empower DTCC to greenlight the issuance of securities, for instance, exchange-traded funds using blockchain networks. This statement comes directly from the desk of DTCC’s CEO, Frank La Salla. The last time DTCC made a purchase was back in 2013 when they acquired the post-trade processing entity, Omgeo.

Frank La Salla emphasized the company’s proactive approach towards tech adoption in a recent interview. “Owing to our significant role as a pivotal infrastructure provider in the sector, we consistently scout for advanced technology,” said La Salla. However, when questioned about the financial intricacies of the transaction, a DTCC representative opted for discretion.

This acquisition symbolizes one of DTCC’s landmark decisions in the realm of digital-ledger technology. Advocates of this technology foresee it as a game-changer, capable of streamlining multiple functionalities in the financial sector. Predictions from analysts at Citigroup Inc. suggest that by the end of the decade, digital tokens on blockchains might represent assets worth up to $5 trillion.

Interestingly, even with Wall Street’s decade-long investments in the technology, only a handful of applications have made it to the mainstream with substantial usage.

As per recent reports, all 100 employees of Securrency will now be a part of DTCC. Post-acquisition, Securrency will undergo a rebranding and will be known as DTCC Digital Assets. The current CEO of Securrency, Nadine Chakar, will stay at the helm of the unit. Additionally, Chakar is set to join DTCC’s elite management committee.

In the past, major financial establishments have endeavored to create proprietary blockchain platforms. This has, however, given rise to concerns regarding redundancy and the introduction of complexity, especially since these platforms often lack inter-compatibility.

The shift in industry dynamics was aptly summarized with the statement: “We’re progressing from a phase of experimentation to establishing effective collaborations.” The past year has witnessed significant maturity in discussions surrounding the feasible applications of distributed ledger technology.