About the CSD Prague project
In view of the development of technology in recent years, whether in the field of cryptocurrencies or crypto assets, or in general the recent emphasis on digitalization enhanced by artificial intelligence, the CSD Prague has decided to take advantage of the opportunity given by the DLT pilot regime regulation to provide services on distributed ledger technology.
The main objective of the CSD Prague is to offer some services directly to the end-owners on very simple principles. In the area of issuers, the dematerialization service is generally very analogous to the standard technology dematerialization service, but in the area of DLT dematerialization, the CSD Prague will communicate with the issuer fully electronically, without the need for a physical visit or the provision of paper forms.
Last but not least, the CSD Prague is gaining experience with the new technology, which can be complementarily used in the provision of existing services within the central securities registry maintained on standard technology.
The main principles of the DLT project are:
The CSD acts both as a central authority and as a DLT participant providing services to end clients.
DLT participant – a participant that becomes part of a DLT (node) and as such has the ability to set up DLT asset accounts. All communication between its clients and the DLT is handled by the DLT participant.
CSD Prague participant – a CSD Prague participant that is not part of the DLT, but may open a client’s asset account based on an agreement with the CSD Prague.
Settlement system – the settlement system at DLT provides for the execution of two basic types of transfers, namely the transfer of securities without cash settlement (DFP) and with cash settlement (DVP). Settlement is always based on the matching of two instructions from the buyer and the seller. The applications allow matching to an instruction already entered by the counterparty. A transfer without cash settlement is settled immediately after the successful matching of the instructions, and in the case of a transfer with cash settlement, after the instructions have been matched and the funds from the buyer have been successfully credited to the CSD account.
Client communication with DLT – the client of the CSD Prague has access to both the DLT internet and mobile application. Client access and authentication is primarily handled using the BankID service.