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BNP Paribas experiments with blockchain for fund trading

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BNP Paribas Asset Management has announced a successful test of a blockchain-based system for fund distribution.

The test, conducted late last year in Luxembourg, involved a “full end-to-end fund transaction” using sister company BNP Paribas Securities Services’ blockchain programme Fund Link.

This was developed last year in partnership with AXA Investment Management and allows all data and paperwork relevant to the transaction to be held in a decentralised digital ledger, available to all parties.

BNP Paribas Asset Management’s experiment also made use of FundsDLT, a fund transaction platform developed by tech companies connected to the Luxembourg Stock Exchange, POST Group and KPMG.

The asset manager claimed in a press release issued this morning that it was “among the first leading global asset managers to take part in this prototype testing”.

Fabrice Silberzan, chief operating officer at BNP Paribas Asset Management, said the blockchain technology would provide investors with quicker transactions and the asset manager with “a sleeker, more streamlined system underpinned by technology and relevant for all fund types and geographies”.

Said Fihri of KPMG Luxembourg said American, British and German companies were interested in working with the FundsDLT tool for product distribution.

The news follows the announcement earlier this week that Lombard Odier Investment Management had conducted a fixed income trade using blockchain technology, one of the first asset managers to do so.

Other firms are working on other uses for the technology, including for private equity deals, equity index data sharing, and pensions administration.

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