Back to General Resources

Regulated Settlement Network Proof-of-Concept

The Regulated Settlement Network Proof-of-Concept (RSN PoC) set out to explore the capability of shared ledger technology to address how the above risks and inefficiencies could be reduced through the tokenization of regulated financial instruments, enabling 24/7 settlement capabilities on a common, regulated venue established under existing legal frameworks. The study analyzed the business applicability, technical feasibility, and legal viability of leveraging shared ledger technology to settle multi-asset and cross-network transactions. The experiment was conducted in a test environment and used simulated data to conduct transactions denominated in U.S. dollars.

Key Findings

Members of the regulated U.S. financial sector launched the Regulated Settlement Network Proof-of-Concept (RSN PoC) to explore possibilities for ledger-based digital settlement using U.S. Treasury securities and tokenized cash. The RSN PoC demonstrated the potential of shared ledger technology to upgrade multi-asset and cross-network transaction settlement for domestic users of U.S. dollars and regulated securities.

  • Business Conclusion: Multi-asset and cross-network settlement could be enhanced through a shared-ledger FMI that contains tokenized securities, tokenized central bank deposits, and tokenized commercial bank deposits where each institution operates its own partition. The network enabled a common settlement infrastructure that is 24/7, programmable, and offered precise settlement capabilities to allow financial institutions to optimize their collateral and liquidity positions. At the same time, the network alleviated challenges such as market fragmentation and uncertainty throughout the settlement process. See the Business Report.
  • Technical Conclusions: The RSN infrastructure was able to support precise settlement capabilities across various asset classes within a shared-ledger FMI, demonstrating the scalability and versatility for modern financial transactions. The RSN successfully connected with other third-party networks through interoperability solutions enabling synchronized settlement. See the Technical Report.
  • Legal Conclusions: It is likely that RSN could operate under existing legal frameworks. The legal workstream did not identify any issues that would prevent the creation of RSN as contemplated within the PoC, although further analysis and engagement with regulators would be required before any final conclusions can be reached. See the Legal Report.

Based on the findings of the PoC, RSN participants will continue to drive discussions with the public sector on industry advocacy around specific regulatory gaps within the U.S. SIFMA intends to continue the dialogue around the concept of a shared-ledger FMI through its industry forums to identify opportunities to operationalize the RSN concept.

RSN Industry Briefing

On Thursday, December 5, 2024, select members of the RSN PoC held an industry briefing to provide a detailed overview of the project, its objectives, use cases findings, next steps, and more. Watch a replay of the briefing.

RSN Participants

  • Citi
  • J.P. Morgan
  • Mastercard
  • Swift
  • TD Bank N.A.
  • U.S. Bank
  • USDF Consortium
  • Wells Fargo
  • Visa
  • Zions Bancorp

SIFMA served as Program Manager for the RSN PoC. The core technology was provided and hosted by Digital Asset, the network interlinking prototype for cross-network interoperability was provided by Swift, and legal services were provided by Sullivan & Cromwell LLP. Deloitte & Touche LLP provided advisory services to SIFMA.

The working group also engaged a group of U.S.-based project contributors, who provided subject matter expertise and explored the applicability of connecting certain external solutions and platforms to the RSN FMI. The group of project contributors includes: The Bank of New York Mellon, Broadridge, DTCC, The International Swaps and Derivatives Association, and Tassat Group, as well as the MITRE Corporation, which engaged as a non-commercial knowledge contributor.

The New York Innovation Center (NYIC) at the Federal Reserve Bank of New York served as a technical observer in this PoC to gain knowledge on the use of shared ledger technology as infrastructure to conduct transfers between regulated financial institutions. The NYIC was focused on observing the participants’ research and experimentation with tokenized settlement assets.

Press Releases & Media Contacts

Press Releases

Media Contacts