Investors in private company securities on Nasdaq

can use Citi’s cross-border payments facility and blockchain to buy, sell and settle transactions. Nasdaq and City Treasury and Trade Solutions announced today they have developed a new integrated payment solution that enables stray straight-throughout processing and automates reconciliation by using a distributed ledger to record and transmit payment instructions. They have run a  number of transactions through the CitiConnect for Blockchain connectivity platform and the Linq Platform powered by the Nasdaq Financial Framework, the companies said in their announcement.

Nasdaq has been early in experimenting with blockchain for private securities which don’t trade on an exchange but can generate significant paperwork as they are bought and sold. At the Futures Industry Association (FIA) conference in Chicago in November 2015, Fredrik Voss, vice president for blockchain innovation at Nasdaq, said shares in private equity deals are deployed in paper certificates and transferring them is very time-consuming.  At the time he said Nasdaq was in a pilot with five clients.

This integration can allow businesses such as Nasdaq Private Market to address the challenges of liquidity in private securities by streamlining payment transactions between multiple parties, their announcement said. Key benefits include a seamless end-to-end transactional process for private company securities and direct access to global payments from Nasdaq’s Linq platform using CitiConnect for Blockchain and WorldLink Payment Services, Citi’s cross-border, multicurrency payments service. The service, which uses Chain’s blockchain infrastructure platform, will provide increased operational efficiency and ease of reconciliation with real-time visibility of payment transactional activity on the blockchain ledger, the announcement added.

"This new payment capability marks a milestone in the global financial sector and represents an important moment in the commercial application of blockchain technology," said Adena Friedman, CEO at Nasdaq. "Through this effective integration of blockchain technology and global financial systems, we can realize greater operational transparency and ease of reconciliation, which can have profound implications for outdated administrative functions in the capital markets.