Vanguard and Symbiont Ally on Blockchain Project

The three firms launched an advanced pilot to use blockchain technology in order to distribute index data and bringing the information directly into Vanguard’s systems, without the need to constantly monitor the CRSP website. The final product is expected to be released sometime in 2018.

Symbiont president and chairman Caitlin Long says the move was envisioned as a means to upgrade the current distribution model of index data providers like CRSP without compromising its subscription model.

“We can permission only what the asset managers have subscribed for, so they don’t receive data they do not need,” Long says. “CRSP was clear that the product must not compromise their subscription model.”

Through the blockchain, when CRSP updates an index, it can upload via file transfer protocol, then a node built with a smart contract grabs that information and feeds it directly into Vanguard’s network. Long says this cuts down on the need to reconcile information and lets asset managers remove manual monitoring of the CRSP website for updates.

In order to start the project, Symbiont had to operate within Vanguard and CRSP’s firewall, which Long says illustrates both firms’ commitment to the initiative. The program began this summer.

She adds that Vanguard, despite providing the impetus to start the project, does not wish to hold the intellectual property for the product and wants the technology opened to other asset managers.

“Of course each company still has to do their own due diligence but we definitely expect that within a year there would be more users,” she says.

“Vanguard has long advocated for greater market efficiency for all participants,” a Vanguard spokesperson tells WatersTechnology. “True to the spirit of blockchain’s decentralized system, this platform will be available to all buy-side institutions so that all investors, and not one single firm, can benefit from more efficient capital markets.”

The platform may also support the distribution of other shareable information like reference data and futures prices. Long says this is only the first of many blockchain projects Symbiont will be working on with Vanguard.