Brattle Experts Discuss Applying Blockchain Technology to Equity Trade Settlement in Law360 Article
Published in Law360
Brattle Principal Sujay Dave, Principal Emeritus George Oldfield, and Litigation Specialist Ethan Moore have coauthored a Law360 article titled “Using Blockchain to Settle Trades Could Alter Litigation.” The article addresses the potential applications of blockchain technology in Rule 10b-5 and Section 11 securities class actions.
The Depository Trust Clearing Corporation (DTCC) and a cryptocurrency startup, Paxos Trust LLC, are both exploring the blockchain-based approach for settling equity trades – known as distributed leader technology (DLT). This new approach has the potential to increase settlement speed, reduce risk, and allow for faster access to funds and reduced costs compared to the traditional centralized approach. However, DLT also comes with its own unique security risks and capacity questions, which the DTCC and Paxos pilot projects are seeking to answer.