February 27, 2017 Alert - SFIG Announces Partnership with Chamber of Digital Commerce

SFIG is pleased to announce the formation of a strategic partnership with the Chamber of Digital Commerce, the trade association representing the blockchain industry, to focus on advancing the use of blockchain technology in securitization markets.

The partnership will commence with the publication of a co-sponsored white paper titled, “Applying Blockchain in securitization: opportunities for reinvention" and a series of educational activities at SFIG Vegas 2017.

The goal of the partnership is to bring the structured finance and blockchain communities together. The two organizations will collaborate on research efforts and publications, joint educational programs and online forums.

In addition to a detailed examination of how blockchain can play a role at each stage of the securitization lifecycle, the white paper, prepared by Deloitte, outlines five distinct benefits for blockchain in structured products:

  • Single, consistent source of information - Blockchain enables a single, consistent source of information for all participants in the network.
  • Complete, immutable audit trail - From loan origination to primary issuance, servicing, and changes in ownership in the secondary market, blockchain can create a chronological and immutable audit trail of all transactions.
  • Better valuation and price discovery - The transparency facilitated by blockchain technology could reduce the information asymmetry and network disadvantages that some entities, especially smaller ones, currently face in the securitization industry.
  • Speed and certainty – Blockchain technology, through its disintermediation and simultaneous recording of information across the system, can virtually eliminate time lags in information and payment flows throughout the securitization process, including in the secondary market.
  • Security - Blockchain’s capacity to increase the security of transactions and data and mitigate fraud could be appealing to the securitization industry, where integrity of data is paramount.

“I am pleased to announce this strategic initiative with the Chamber of Digital Commerce, which has established an important position in representing the growing blockchain industry,” said Richard Johns, SFIG Executive Director. “Partnering with the Chamber is a key part of our focus on being a central resource of forward looking education to all market participants. With this partnership we can create new, forward-thinking and educational opportunities for our members enabling them to stay fully informed of how technology is impacting their business. Today’s white paper is just the beginning of what we expect to be a very active and productive partnership.”

“The securitization process is an ideal candidate for the efficiencies of distributed ledger technology,” said Perianne Boring, founder and president, Chamber of Digital Commerce. “Blockchain platforms create a more transparent and secure marketplace allowing the industry to provide better products more securely at lower cost. This will also enable the market to more efficiently comply with regulations, while at the same time allowing automation to create significant efficiencies for the role of the regulator itself. Our partnership with SFIG is an opportunity to accelerate the understanding and adoption of blockchain technology in this sector.”

Tomorrow, SFIG Vegas will feature an entire afternoon dedicated to blockchain technology. Blockchain University will be a series of strategically sequenced symposia that build in complexity and offer conference participants a better understanding of the blockchain technology, its application to our industry, and specifically how it may impact the various transaction parties in a securitization. If you would like to join SFIG's Blockchain Task Force, please contact Alyssa.Acevedo@sfindustry.org.

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