Nordic financial group SEB and Nasdaq have unveiled a joint project to test a developed prototype for a mutual fund trading platform based on blockchain technology.
This platform aims at improving the processing of purchases and sales of fund units and to create a unit ledger.
The blockchain-built platform will enable the players of the Swedish fund market to share a distributed database in which all transactions and changes are registered among all participants in real-time.
Through the cooperation agreement, SEB and Nasdaq will continue to develop the technology with the end goal of creating a working prototype, which will be based on the Chain.com blockchain ledger.
Also the two companies have opened a channel for collaboration with additional interested parties on building a uniformed market infrastructure for Sweden’s fund market.
The Swedish fund market does not currently have a central point for registering holdings, therefore the administration of purchases and sales of fund units are handled through an intermediary or directly with each executing party and rely on different solutions, including orders placed by paper driven processes and follow-up phone calls.
“With the help of a blockchain we can create a faster, simpler, more effective and reliable fund market,” said Göran Fors, head of Investor Services at SEB.
“Funds are increasingly important for our clients and it is with great pleasure that we can announce this important project together with Nasdaq,” he added.
Magnus Haglind, SVP & head of Product Management, Market Technology, Nasdaq, commented: “By leveraging blockchain technology there is strong potential for improvement via digitalisation that can reduce manual work, create a faster process and reduce the risk for errors.”
“This development will look to benefit the fund market and, in the end, also the individual investors through faster response from purchases and sales.”
As of end of June 2017, SEB’s assets under management totalled SEK1.83bn (€190.8m).