WisdomTree, T. Rowe Price Choose Avalanche Subnet For Trading Testing

Key Points:

• T. Rowe Price, Wisdom Tree, Wellington, and Cumberland are among the financial organizations that have joined layer 1 blockchain Avalanche’s Evergreen subnet “Spruce” to improve trade execution and settlement.
• Spruce will be used as a testnet for a range of applications and assets to assess the advantages of on-chain transaction execution and settlement.
• Evergreen Subnets were introduced by Avalanche earlier this month.

According to a release from the Avalanche team, financial institutions like T. Rowe Price, Wisdom Tree, Wellington, and Cumberland have joined layer 1 blockchain Avalanche’s Evergreen subnet to improve transaction execution and settlements.

The new “Spruce” subnet is part of Avalanche’s Evergreen Subnet ecosystem. According to the announcement, institutions want to utilize Spruce as a testnet for a range of applications and assets in order to assess the advantages of on-chain transaction execution and settlement. Traditional finance (TradFi) companies would utilize valueless tokens on Spruce at first to guarantee they can execute currency operations without losing cash. Early on, interest-rate swaps will also be tried.

In the long term, successful testing will enable these organizations to experiment with further blockchain settlement approaches, such as tokenized stock and credit issuance, trading, and fund management.

Blue Macellari, Head of Digital Assets Strategy, T. Rowe Price Associates, stated:

“Participating in the Avalanche Spruce testnet presents a valuable opportunity to deepen our understanding and analysis of smart contract technology and the potential applications of public, permissioned blockchains in financial markets.”

Avalanche launched Evergreen Subnets earlier this month with the goal of providing financial institutions with a suite of blockchain installations and technology.

Evergreen Subnets are Ethereum Virtual Machine (EVM)-based chains with a permissioned validator set and a proprietary gas currency to fuel transactions. At the time, an Ava Labs representative said that these subnets were required since earlier systems, such as Corda and Hyperledger, were not compatible with the demands of major institutions.

Spruce provides compliance capabilities to assist organizations to stay within the boundaries of the law. Companies who wish to use it must first pass Know Your Customer (KYC) verifications, after which they will acquire non-transferable tokens, or NTTs, that will identify them on the network. Upon verification, their wallet addresses are likewise whitelisted at the chain level.

The decision comes as TradFi firms have been investing more heavily in blockchain technology and cryptocurrency-related products in recent years, marking a potential step toward further acceptance among big financial institutions.

Spruce is one of two Avalanche Evergreen subnets that have been deployed and listed on the Avalanche website since the protocol’s debut. The other is Intain, an Evergreen subnet devoted to structured finance.

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