FICC is looking at potential solutions using distributed ledger technology to clear both legs of overnight repo trades, which could allow for greater netting opportunities and thereby reduce potential liquidity needs. 13 Several CCPs are also looking at ways to expand central clearing to directly include more buy-side firms, which could also offer greater netting opportunities.
Doing so could also offer new sources of liquidity if the new entrants are able to take part in the CCP’s committed liquidity arrangements. Diversification of sources of liquidity would offer tangible benefits--CCPs would avoid relying on the same limited set of clearing members for all of their liquidity needs.