Blockchain Can Scale to 100 M Equity Trades Daily

The Depository Trust and Clearing Corporation (DTCC), generally thought to be the apex post-trade market facility, announced on Tuesday, October 16, a wide study that concluded that blockchain can be leveraged to underprop arithmetic mean daily trading volumes in the flourishing U.S equity market of 100 million trades daily.

Accenture, the multinational Information Technology (IT) mammoth, carried out the research study in collaboration with other giant IT service providers such as R3 and Digital Asset ( DA). 

The Efficiency of DLT 

The conducted study concluded that DLT could process around 115 million trades per day, or 6,300 trades per second for five full hours continuously. The research study avows the present state of public DLTs supporting digital currencies, that circa process transactions in one or two digit per second rate. 

The study that private DLT can process around 6,300 transactions per second will give cynics something significant to ponder about. Nevertheless, it's worth saying that the research "study only tested the grass level functionality." 

Alex Reinhardt, Venture investor, business development expert, serial entrepreneur, Co-Founder and CEO of ELVN Crypto Messenger and Wallet, stated to Coinidol: 

 

“Transaction speed is one of the most important characteristics for blockchain. Unfortunately, the majority of cryptocurrencies cannot withstand the market pressure at the moment. Transactions can be delayed up to 19 days, especially in Bitcoin. This speed has a negative impact on the business. For trading, the speed of decision making and execution of targeted actions is very important. Even 19 minutes is too long for the transaction speed. The situation in the market is changing every minute. Professional traders have to take precautions and keep funds in their wallets for quick transactions. This is an additional risk because the exchanges are constantly being hacked. If the DTCC can really ensure a high rate of transactions, it will increase trading volumes and reduce risks. Traders will be able to respond faster and earn more. Therefore, this is very good news.” 

Prototype Created to Capture Market Operation 

DTCC officially commissioned the research from Accenture for bullish "technical expertise and creating a prototype of the U.S equity clearance and settlement system." DA and R3 were offered a role to give "support on performance tuning." 

The chief goal behind the research study was to measure DLT's prowess in processing the hefty trading volumes of the U.S equity market; and clearly, the results appear to be promising to say the least. 

Application of DLT in equity stock exchanges isn't a new thing. In May 2018, the Australian Stock Exchange also considered implementing blockchain technology by 2020.