“There are two drivers shaping the future of capital markets in Europe. One is technology and the other is regulation. Sometimes technology leads the way, while at other times regulation sets the course. Efficient and future-proof digital markets need the best of both worlds, technology and regulation, to work successfully.
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Over the past decades we have electronified market models to create tools like open limit order books and electronic clearing houses. We have tried to optimize processes, but we are still in the batch-processing stage for certain processes. What we have not done is taken the capital markets’ core product (which is a security) digital.
Making markets more efficient
Future success involves shortening the distance between issuers and investors, not physically, but in terms of time. This means enabling features like instant issuance, direct distribution and seamless settlement of securities. A key aspect of the transformation is the need to fully digitize the core product of the securities industry, moving away from batch processing and towards a more seamless, digital lifecycle for securities.
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