A technical overview of distributed ledger technologies in the Nordic capital market.

Abstract: This thesis examines how Distributed Ledger Technologies (DLTs) could be utilized in capital markets in general and in the Nordic capital market in particular. DLTs were introduced with the so called cryptocurrency Bitcoin in 2009 and has in the last few years been of interest to various financial institutions as a means to streamline financial processes. By combining computer scientific concepts such as public-key cryptography and consensus algorithms DLTs make it possible to keep shared databases with limited trust among the participators and without the use of a trusted third party. In this thesis various actors on the Nordic capital market were interviewed and their stance on DLTs were summarized. In addition to this a Proof of Concept of a permissioned DLT application for ownership registration of securities was constructed. It was found that all the interviewees were generally optimistic about DLTs potential to increase the efficiency of capital markets. The technology needs to be adopted to handle the capital markets demand for privacy and large transaction volumes, but there is a general agreement among the interviewees that these issues will be solved. The biggest challenge for an adoption of DLTs seem to lie in that of finding a common industry-wide standard.