A new report released this week by blockchain startup Digital Asset Holdings claims that the company has created a blockchain-based platform that will preserve trade confidentiality. If those claims are correct, the platform could help to remove one of the major obstacles to more widespread adoption of distributed ledger technology by the financial industry. The announcement comes on the heels of Digital Asset CEO Blythe Masters’ recent remarks about sensitive data:
“Our view is that sensitive, contractual, market-moving, private data should be kept private. Let’s think about what regulators and regulated financial institutions care about. First of all, it’s privacy.”
Digital Asset’s solution to those privacy concerns involves dividing the transaction ledger into two separate transaction components. One part is maintained on a bank server, and contains the price, transaction party details, and other private user transaction data. The other part remains on the public network as a digital fingerprint (or hash), but the transaction can only be properly interpreted by those with access to the privately-maintained bank component. The system is described in greater detail in the white paper released by the company on Wednesday.
Digital Asset is counting on the new system technology for its current work with the Australian stock exchange (ASX), and the Depository Trust & Clearing Corp. in the U.S. Masters’ company is working with those firms to examine whether blockchain technology can reduce trade settlement times. The company has indicated its desire to have the new technology available for those firms’ use by the end of next year.