Smart Derivative Contract Clearing (SDCC) is the world’s first Decentralised Finance (DeFi) clearing house providing valuation, margining, default management and settlement services for Smart Derivative Contracts.
The leadership team at SDCC has over 100 years experience in building financial systems and over 35 years in Investment Banking Sales and Trading and has strong relationships with many large European companies.
The Over-the-Counter (OTC) derivative market has a staggering gross notional of over 600 trillion USD and is the cornerstone of global finance. Yet, it is riddled with inefficiencies such as high costs, systemic risks, operational inefficiencies, and lack of innovation.
Smart Derivative Contracts address many of these shortcomings by providing intraday settlement of cashflows and margin with a built-in default termination mechanism. These reduce the margin and capital requirements for the SDC over the traditional OTC derivative contract, allowing derivative counterparties to redeploy capital savings to other opportunities.
By using SDCC as your Smart Derivative Contract clearing platform, you will benefit from lower costs from smaller Initial Margin requirements, capital savings, greater flexibility on OTC contract definitions in line with upcoming regulatory demands (in particular, the EU’s post-Brexit clearing rules), and greater transparency with regulators by using the latest technology such as cloud services and Blockchain.
SDCC provides valuation, margining, default management and settlement services for Smart Derivative Contracts to banks and other financial institutions. We have identified use cases and re-thought them as applications operating on blockchain (distributed ledger) technology. The application of blockchain technology bears some specific advantages, namely superior security, transparency and reliability compared to centralized approaches.
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“XVA Blockchain has the potential of removing the costly frictions embedded in current collateral cash flows. The team behind XVA Blockchain has long standing expertise in all relevant aspect, from mathematical finance to valuation adjustment (CVA) to blockchain technology and coding.”
Partner, Digital Competence Center, Roland Berger
“Blockchain technology will be a key disruptor of current business models. As Bitcoin has already shown spectacular growth over the last few years, the underlying Blockchain technology will now step forward and unfold yet unseen potential to rethink business models across industries. XVA Blockchain are at the forefront of this and I am excited to see what lies ahead for them.”
Managing Director, CVA Services GmbH
“The XVA Blockchain is a solution which utilises distributed ledger technology for ease of integration and a low cost to market. The use cases are perfectly designed for Clearing- and Collateral-Management-Services of large financial institutions. Improved visibility by the nature of the blockchain encourages regulators to support admission.”
XVA Blockchain was founded in late 2017 and released two white papers that same year. Already in 2018 ISB Bank in Mainz invested in the first seed funding. A year later, in 2019, MVP development and DTCC partnership followed. A proof of concept was signed with two German banks in 2020.
For the first time in the world, on June 2021 DZ BANK and BayernLB successfully traded an XVA Blockchain OTC interest rate derivative in the form of a smart derivatives contract. In addition, the second seed funding was successful with ISB Bank and CoinIX and new customers were acquired.
In 2022, the focus was on global operations and the international rollout. The first XVA Blockchain Office was inaugurated in New York in Q1 2022.
In 2023, XVA Blockchain was renamed Smart Derivative Contract Clearing (SDCC), having one clear single objective, to bring Smart Derivative Contracts to the market.
Do you want to learn more about XVA Blockchain and our overall business concept? Don’t hesitate to reach out to us!
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