German financial services company Commerzbank (DE:CBKG) and securities marketplace Deutsche Boerse (DE:DB1Gn) have completed a proof-of-concept (PoC) for a legally binding repo transaction using distributed ledger technology (DLT). The news was reported by Cointelegraph auf Deutsch on March 6.
A repo transaction is commonly used for short-term borrowing, and allows dealers to sell securities to investors — often for as short a time as overnight — and repurchase them the following day, or as otherwise determined. For the party selling the security, the process is termed a repo, whereas for the counterparty, it is known as a reverse repurchase agreement.
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