UBS issues siloed platform warning

Banks must work together on new platforms if Blockchain-based innovations for trading are to be successful, UBS has warned.

Speaking at London FinTech Week, Gary Chu, lead lawyer for the UBS FinTech Innovation Lab, told delegates that banks which are developing new distributed ledger technology based platforms must work together to form a common framework.

He said: “If we are working on a platform for the issuance and trading of bonds, and Morgan Stanley has a different panel for trading securities, we must develop a common platform to generate certainty in the market”

Chu said collaboration in areas such as settlement finality would be key to the success of any new platform launches and underscored that interoperability – the ability for all systems to share information – was a priority for UBS projects.

Stuart Davis, managing associate in the Financial Regulation Group at Linklaters, joined Chu on stage at the event.

Davis praised regulators for the work they have done in bringing Blockchain discussions to light, but suggested that regulation may be necessary for the technology to reach the next level.

He added: “With new initiatives such as Project Innovate and the regulatory sandbox, its clear that the FCA is dedicated to creating safe new technology that will help the financial services sector”

Davis complimented the FCA on projects such as the regulatory sandbox – a safe space in the regulatory sphere where FinTech companies can test their products for free.