Use Case : Structured Products
STACS Blockchain is looking to increase internal efficiencies between departments involved in a structured products transaction and uses smart contracts to automate asset servicing aspects.
VALUE-DRIVEN BENEFITS FOR CLIENTS
Instant transaction notifications for stakeholders
Clear audit trail for the credit and risk teams.
Regulators can be granted access to Native STACS too.
Reduce reconciliation across departments. Reduced manpower and cost expensed on mapping data.
Accurate data recordkeeping on the blockchain, which serves as a single source of truth
High availability and no single point of failure for database management
How DLT Benefits Structured Products In Markets
Streamline and automation of operational processes between the markets, clients, operations, credit and risk teams
Mandatory events and distributions can be managed via smart contracts embedded within the securities, for example, automation of Knock-In Knock-Out (KIKO) triggers and pay-outs
Complex events can be structured as simple Delivery Versus Payment (DVP) transactions between issuers and investors
Greater efficiencies between clearing, settlement, reconciliation and reporting amongst the issuer, distributor, counterparty and clients
Potential secondary trading of structured products
The Ability To Construct Bespoke Instruments With DLT
Based on new approaches to financial engineering and unbundled securitiesThese instruments could consist of individual cash flows which will meet precise needs in terms of timing and credit riskThese instruments could be financed by issuers selling their own instruments that match the cash flows they expect to achieve, which means creating swaps without the need for balance sheet intermediation