Shorter settlement cycles are sweeping global markets. In 2024, the U.S. moved to T+1 equity settlements. Europe and Asia are expected to follow by 2027.
Blockchain-enabled atomic settlement allows instant transfers, reducing counterparty risk. But speed introduces new challenges. Each transaction must be fully funded upfront, eliminating netting opportunities that traditionally boosted capital efficiency.
In a T+0 model, the same capital supports far fewer trades. Hedge funds and market makers face higher costs and tighter liquidity demands. Retail investors may see wider spreads and reduced depth.
NSCC data shows clearing fund levels dropped after the shift to T+1. Under atomic settlement, such pressures will intensify. Intermediaries once thought obsolete-banks and prime brokers-are regaining influence by managing real-time capital flows.
Efficiency gains from blockchain depend not just on speed, but on infrastructure capable of coordinating liquidity. Firms that master both will shape future markets. Speed alone does not remove the need for trusted systems-it redefines who controls access.