The largest clearinghouse in the US, the Depository Trust & Clearing Corporation (DTCC), has provided performance details for its private blockchain.
According to a recent press release, the blockchain, called Project ION, is processing “100,000 bilateral equity transactions per day, and almost 160,000 transactions on peak days.”
DTCC describes Project Ion as a “resilient, secure, and scalable” settlement service that can satisfy regulatory standards.
Whereas most public blockchains process simple monetary settlements like fees and remittances, DTCC’s distributed ledger has to settle contractual equity ownership between tens of millions of counterparties across thousands of brokerages, whilst remaining compliant with NYSE or NASDAQ rules and US securities laws.
DTCC’s permissioned blockchain clears shares of stock
DTCC selected R3 and its Corda technology to build the distributed ledger that underpins DTCC’s Project Ion platform.
At the moment, DTCC’s classic, non-blockchain settlement system remains its authoritative record, clearing $2.37 quadrillion worth of securities in 2021. Project Ion’s blockchain is running in parallel with this legacy system until regulators approve the full phase-out settlement.
The clearinghouse developed Ion in collaboration with major brokerage houses like Barclays, Charles Schwab, Fidelity, and Robinhood.
How the clearinghouse’s ledger compares to other blockchains
As Project Ion is a privately distributed ledger, DTCC retains full control over the system. Access and participation must be approved by the company.
The company provides different levels of access to its consortium members, such as administrative privileges to its wholly-owned depository, or view-only access to financial advisors.
Permissioned blockchains have the advantage of being more scalable than public blockchains. With fewer parties making decisions and no resources expended on consensus-making, increasing a blockchain’s capacity becomes much easier. The relative ease of scaling the blockchain typically results in higher transactions per second.
Public, permissionless blockchains can still process large volumes of payments. Bitcoin processes 400,000 transactions on peak days and routinely handles 300,000 transactions daily.
However, because DTCC has complex needs, which do not include decentralization, it chose the scalability of a permissioned blockchain.