The global financial market infrastructure giant, DTCC (Depository Trust & Clearing Corporation) states the need to update the traditional IT security frameworks to incorporate blockchain.
DTCC published a new white paper for the creation of DLT-specific Framework and an industry consortium to originate into guidelines and regulations for the sector.
DTCC Published A White Paper, Security Of DLT Networks
According to the White paper released by DTCC, in financial services, DLT is defined by its standards and guidance concerning the security risks in technology. DLT is devised to provide a broad spectrum of value propositions to various actors. The range of value propositions includes robust identity measures, data integrity, enhances operational capacity and information preservation, data integrity, as well as effective compliance.
Although, there come new risks with new and enhanced features that need better standards consensus around terminology, DLT interoperability, established identity management and effective governance. The paper further argues that almost every financial industry is seeking to contribute to the DLT security framework.
DTCC noted that the framework would help assist individual firms in the completion of risk evaluations with the help of tools and practices including cybersecurity controls, risk management and oversight, incident management and third party management.
For the creation, storage, maintenance, as well as disposal of sensitive data, technology based-considerations should be taken into account. This would set up standard authentication practices and fill in the security gap between the traditional IT environments and DLT.
Stressing the need for the strategy to develop industry-wide consensus, the chief security officer at DTCC, Stephen Scharf stated that frameworks required to be widely available agreed upon and adopted in the communities of IT security. Then the mature practices can be used for financial industry regulators by adopting into a formal framework.
The following is not the DTCC’s first attempt to tackle the DLT policy standards in financial services as in last year, March, it released a white paper for the guidelines related to the processing of tokenised securities.