It will only take one broker-dealer to usher in the era of distributed securities settlement, according to Overstock’s blockchain innovation lead. Once the technological barriers of connecting the platform to a blockchain are crossed and the regulatory climate has been navigated, Johnathan Johnson expects a floodgate of securities professionals looking to cut out pricey middlemen to open. Overstock ‘s signature blockchain project, tØ, announced this week it had signed Keystone Capital Corporation to be that partner, and with the move, it believes it’s one step closer to that new era. In new statements, Johnson said that while the technological undertaking of Keystone is actually quite minimal, what separates the firm is its willingness to take on those middlemen. In this light, Johnson said the potential gain to those who cut out some of the financial system’s most important figures is "huge". Johnson told CoinDesk: "I think they want to see that an offering has worked and trades have come through and a digital security has settled. Once that’s in place, I think if I were a broker dealer I’d be pretty eager to adopt because it potentially means more business with less cost." Johnson breaks down the work of building a blockchain-based settlement platform into three categories. The first, building the product, is "knocking on the door of being done," he says. The final two steps, ensuring regulatory compliance and signing up market participants, he contends, will happen simultaneously as the integration is completed. Plugging into tØ Technologically speaking, tØ’s settlement platform is designed to be blockchain agnostic, but today it’s unconventional in that it uses the bitcoin blockchain for additional security. But maybe more importantly, the platform is also set up so that most of this technological heavy-lifting (and understanding) is done by the software, not the broker. […]
