Dutch bank ING has made an investment into HQLAx, the newly launched collateral mobility system using distributed ledger technology (DLT).
The investment builds upon ING’s earlier involvement with the platform, as its blockchain team helped develop the initial version of the HQLAx application.
“The successful commercial launch of HQLAx is a big milestone for the implementation of blockchain in the securities lending market and proof that blockchain can bring tangible benefits to the industry,” said Mariana Gomez de la Villa, head of ING’s blockchain team. “It’s rewarding to see that a project we’ve been working on for years, is now live.”
ING and HQLAx also partnered in 2018 to carry out the first live securities trade on a blockchain platform, where it exchanged €25 million of high quality liquid assets with Credit Suisse using the collateral lending application of HQLAx on R3’s Corda DLT platform.
The investment comes just months after HQLAx went live, executing its first commercial live transaction with Commerzbank, Credit Suisse and UBS.
ING, as well as CIBC, Citi and Goldman Sachs, are also engaged in different phases of onboarding to the HQLAx platform. Meanwhile JP Morgan is in the process of becoming the third tri-party agent in the HQLAX operating model, alongside Clearstream and Euroclear Bank.
“The HQLAx value proposition is to enable improved collateral mobility across multiple market-recognised tri-party agents and custodians. Naturally speaking, the greater the number of tri-party agents and custodians that connect to our platform, the greater the network effect of our value proposition,” HQLAx said in a recent post.
Switzerland-based HQLAx is looking to bring efficiencies to moving high quality liquid assets by creating a digital collateral record that represents an ownership stake in baskets of securities, enabling an easier transfer between custody accounts without the physical movements of assets.