What's Happening?
Broadridge, a global fintech leader, has released its sixth annual 'DLT in the Real World' report, highlighting a significant acceleration in the adoption of distributed ledger technology (DLT) and digital assets across global financial markets. The report, developed in collaboration with The ValueExchange, ISSA, Accenture, and Taurus, indicates that firms are increasingly moving from pilot projects to live deployments. Horacio Barakat, head of digital innovation at Broadridge, noted that digital asset adoption has become operational, marking a clear inflection point in the industry. The study reveals that 36% of respondents have active DLT initiatives, with North America leading the adoption, where 50% of firms are running live DLT or digital asset projects. The report also highlights a rapid growth in digital asset adoption, with projects spanning various asset classes such as tokenised funds, stablecoins, and bonds.
Why It's Important?
The acceleration in DLT and digital asset adoption signifies a transformative shift in the financial industry, potentially enhancing operational efficiency and liquidity. The report suggests that buy-side engagement is a key driver, with 61% of buy-side firms involved in digital asset initiatives. The primary motivations include improving intraday liquidity, reducing transaction costs, and minimizing failed payments. This shift could lead to significant cost savings and operational improvements for financial institutions. However, challenges remain, such as limited secondary market liquidity and the need for clearer legal and accounting frameworks. The report indicates that political and market conditions in 2025 have further accelerated the adoption of these technologies, suggesting a growing recognition of their strategic importance.
What's Next?
Looking forward, the report anticipates that more organizations will transition from pilot projects to fully integrated operations by 2026, leveraging DLT infrastructure to support higher transaction volumes and faster liquidity. Broadridge's Distributed Ledger Repo platform exemplifies this trend, having processed over $280 billion in average daily repo transactions in August, a significant increase from the previous year. As firms continue to invest in DLT and digital assets, the financial industry may witness further innovation and efficiency gains, potentially reshaping market dynamics and competitive landscapes.
Beyond the Headlines
The broader implications of this shift towards DLT and digital assets include potential changes in regulatory frameworks and market structures. As adoption increases, there may be a need for enhanced regulatory oversight to ensure market stability and protect investors. Additionally, the integration of these technologies could lead to new business models and opportunities, fostering innovation and competition within the financial sector. The ethical and legal dimensions of digital asset transactions will also require careful consideration as the industry evolves.
