D3ledger Tests Safekeeping of Cryptoassets for Institutional Investors Through Distributed Digital Depository

News and Analysis

D3ledger, a software provider for the D3 decentralized crypto assets depository, has started to provide safekeeping of digital assets and cryptocurrencies using its distributed digital depository platform.

According to the announcement, on October 16, AddCapital Investment Fund has started to use custody services from D3ledger. Safekeeping service has been done under the partnership with Swiss fintech-startup Lykke.

“Our service is a way for financial institutions to securely deposit their assets in a distributed and immutable way,” said Makoto Takemiya, co-founder of D3ledger. “Ultimately it will lead to a larger institutional adoption of crypto assets.”

Alex Prokofyev, managing partner of AddCapital, believes that “professional market is missing simple and effective solutions in assets safekeeping which would cover a wide list of crypto-assets, approachable right away and friendly to regulation in multiple countries.”

“We focus on developing new financial solutions and instruments especially in new technologies. We hope that D3ledger will soon become a strong and widely accepted digital assets safekeeping and settlement service at a large scale,” he said.

As indicated in the CSD report, D3ledger addresses the pressing need to create a safe and efficient environment for investors in the emerging crypto asset class.

Technically D3ledger provides secure decentralized storage and settlements using Hyperledger Iroha blockchain platform built by Soramitsu and open-source community. Hyperledger Iroha allows asset tokenization based on distributed ledger technology, providing a high level of trust and security. D3 network is based upon proof-of-stake consensus (YAC https://arxiv.org/pdf/1809.00554.pdf) which allows D3ledger to process more than 2,000,000 safekeeping and settlement operations per day.

D3ledger peer network consists of three nodes for this pilot deal:

  • KDD (Slovenian CSD)
  • National Settlement Depository
  • Lykke

Sources of D3ledger are open on GitHub and passed security audit by Lykke.

D3ledger representatives also stress that decentralization, being the key feature of the offering, gives crypto investors and financial intermediaries such benefits as:

  • Sufficient level of regulatory transparency
  • Virtually no risk of infrastructure downtime
  • Easy re-landings of account to a new jurisdiction
  • Safe ownership through identification of each owner via the network of nodes. Ownership records are safe even the in case of default/bankruptcy of one of the partners
  • Easy governance of the network through the steering committee and voting procedure.

“D3ledger is set to become a key pillar for new digital markets ecosystem, enabling geo-distributed compliant custodial and settlement services, which is essential for large-scale institutional adoption”, said CEO and founder of Lykke Richard Olsen.

“Our service improves the reliability of crypto safekeeping and brings the ability to recover possession of digital financial assets like cryptocurrencies and tokens in the case of the loss of keys,” added Ryu Okada, co-CEO of Soramitsu, a leading contributor to the Hyperledger Iroha platform and D3ledger sources.

D3ledger was co-founded by NSD (National Settlement Depository, the central securities depository of the Russian Federation) and Soramitsu Co., Ltd, a blockchain and fintech startup that created and co-maintains distributed ledger platform named Hyperledger Iroha. Soramitsu aims to create a safe and convenient way to manage digital identities using blockchain technology. As a member of the Hyperledger Project, which is being managed by the Linux Foundation, Soramitsu aims to contribute to software standards for blockchain and distributed ledger technology.

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