Earlier this month, DTCC signed a definitive agreement to acquire Securrency Inc., a leading developer of institutional-grade, digital asset infrastructure. Upon closing, Securrency will become a fully-owned subsidiary of DTCC and will operate under the name DTCC Digital Assets.
Lynn Bishop, DTCC Managing Director and Chief Information Officer, sat down with DTCC Connection to discuss how the acquisition will help the industry unlock the value of digital assets and support firms through their digital transformation journey.
Related: DTCC Signs Definitive Agreement to Acquire Securrency Inc.
Q: DTCC has been a leader in working with blockchain technology for several years. What prompted the decision to acquire Securrency?
LB: One of the keys to growing adoption of digital assets is having a trusted and robust infrastructure to underpin the market and protect the safety and stability of the financial system. The acquisition is rooted in our strategy to develop that infrastructure to enable end-to-end digital lifecycle processing for tokenized assets, digital currencies and other financial instruments. It also gives us powerful new capabilities to bridge best-in-class industry practices with advanced digital technology to encourage greater use of digital assets.
Q: Can you tell us more about DTCC’s digital asset strategy?
LB: Our digital asset strategy is comprised of three pillars: Expand to Adjacencies; Develop a Digital Asset Platform (DAP); and Connect Networks. A core tenant of our strategy from the onset has been to remain DLT-agnostic and focus on the development of capabilities that will allow DTCC and our clients to engage with a broad set of networks and protocols as the digital asset landscape continues to evolve.
Q: How are you executing on the strategy?
LB: We’ve established a series of strategic priorities that include exploring the development of digital products and services to address gaps in market infrastructure, optimizing the end-to-end lifecycle and creating a control framework for digital asset securities. In addition, our priorities also include executing client-driven pilots aligned to our core capabilities and services and advancing the industry-wide dialogue on interoperability to inform future connectivity models.
Q: How will DTCC use the technology to drive its own digital evolution?
LB: The acquisition opens the door to several new opportunities. The combination of DTCC’s digital capabilities and Securrency’s technology will allow us to fast-track development of our enterprise digital asset platform. This is a key pillar of our digital asset strategy. We’ll also leverage the technology over time to embed digital assets within our existing products and services; develop new, regulatory-compliant blockchain-based offerings; and explore use cases with the industry. We want to engage with buyside asset managers, broker-dealers and custodians to collaborate on new DTCC blockchain-based solutions.
The acquisition is rooted in our strategy to develop that infrastructure to enable end-to-end digital lifecycle processing for tokenized assets, digital currencies and other financial instruments.
Q: Will you also make the technology available to the industry?
LB: Yes, that’s actually a very important aspect of the transaction. By licensing the technology and offering professional services to the industry, we are confident that we can lead the development of a robust, global digital infrastructure. In doing so, firms can leverage the technology to transform and evolve their operating models and also create new digital asset services alone or in collaboration with other market participants. This model is similar to how WisdomTree licenses Securrency’s software as part of the infrastructure for its WisdomTree Prime™ offering that provides tokenized assets and funds via digital wallets for retail investors and consumers.
Related: FMIs Role in Advancing the Digital Asset Era
Q: I’d like to switch gears to talk about interoperability because it’s critical to promoting adoption of digital assets. How will the acquisition support future efforts in this area?
LB: DTCC has been strong advocate for industry-wide collaboration and has advocated for interoperability for many years. We’re now in a stronger position to provide global leadership on this issue to avoid fragmentation with different digital technologies and standards. What’s very exciting is that the technology can address interoperability by acting as a DLT-agnostic harmonization layer that also promotes liquidity, transparency and security. We want to build upon our past efforts to establish consensus on the right architecture and infrastructure to enable widespread interoperability.
Q: We know the best strategy won’t work if you don’t have the right people to execute it. Have you had a chance to meet the Securrency team yet?
LB: I had an opportunity to introduce myself during a town hall recently, and I’m really looking forward to getting to know them and for all of us to start working together. Each of our companies brings complementary strengths to the table when it comes to talent. Both DTCC and Securrency have an outstanding group of professionals, including highly skilled technologists, who are passionate about innovation and technology and motivated to make a difference by transforming how financial markets operate. I’m confident that our collective partnership will deliver outstanding results for our clients and the industry in the years ahead.
If you would like to learn more about Securrency, please reach out to your Relationship Manager or Client Account Services.