The Future of Derivatives Markets: A Roadmap for Innovation

The ISDA Future Leaders in Derivatives (IFLD) are excited about the promise of innovative new technology and its potential to transform financial markets. This paper encourages current leaders to embrace transformational change and supports them in adopting an ambitious strategy for defining a digital future for financial markets, fostering an environment for technological innovation, and building a safer, more robust global financial system.

The purpose of this paper is to provide a roadmap for participants in the derivatives industry who are working to implement new technology solutions and applications aimed at optimizing and digitizing financial markets over the next decade. The recommendations set out in this paper are intended to empower current and future leaders to take proactive steps in developing tangible use cases, resolving challenges associated with these use cases and delivering on the promise of innovative and transformational new technology.

The paper considers the maturity of the relevant technologies and proposes metrics for determining which solutions should be prioritized. Based on these metrics, it identifies two compelling use cases:

  1. the use of DLT to simplify, standardize and automate the regulatory reporting process; and
  2. the implementation of digital assets within collateral management systems to lower settlement times and reduce risk.

The paper elaborates on the current state of trade reporting and collateral management and identifies relevant issues and pain points that could be resolved using a particular technology solution. It then sets out a roadmap to explain how the benefits of technology can be achieved.

While the intention is not to specify or recommend any particular approach, or to address any specific technological application or project, it does suggest steps that should be taken to design implementation programs, and also highlights areas where further industry collaboration will be required to identify and resolve existing areas of uncertainty.

Documents (1) for The Future of Derivatives Markets: A Roadmap for Innovation

ISDA AGM Studio: Jacques Vigner, BNP Paribas

Jacques Vigner, ISDA board member and chief strategic oversight officer for global markets at BNP Paribas, speaks with Mark Gheerbrant, global head of risk and capital at ISDA, on the key obstacles to a consistent, risk-appropriate capital framework and how to...

ISDA AGM Studio: Future Leaders in Derivatives

Following publication of the latest whitepaper from the ISDA Future Leaders in Derivatives (IFLD) program, Collateral and Liquidity Efficiency in the Derivatives Market: Navigating Risk in a Fragile Ecosystem, Joel Clark talks to IFLD participants Koen Ottenheijm, senior treasury and...

Australian Superannuation Funds Use of Derivatives

The funds under management (FUM) of Australian superannuation funds have grown substantially since legislation was introduced in 1992 requiring employer contributions. Over the past five years, total FUM has climbed from approximately A$2.3 trillion ($1.44 trillion) to A$4.1 trillion and...