OSTTRA’s FX PvP settlement orchestration service grows as Fnality collaborates with Baton’s distributed ledger technology (DLT) and becomes the first digital settlement system to be added to the network. 

 

London, 21.05.2025 – OSTTRA and Baton Systems today announced a strategic collaboration with Fnality following the successful completion of a proof-of-concept integrating Fnality’s system with their on-demand FX payment-versus-payment (PvP) settlement orchestration service. In addition to the current ledger-supported intraday and on-demand netting and settlement, Fnality expands available settlement options using an asset with the credit characteristics of central bank money, that is recorded on a DLT ledger, to settle around the clock. This will allow institutions to efficiently manage both liquidity and settlement risk. 

Over the past year, OSTTRA and Baton have been actively engaging with a group of leading market participants, including 12 major banks, to guide development plans and ensure the service enables more FX market participants to benefit from the assurance and liquidity management benefits of on-demand, atomic PvP settlement-functionality which can prove critical in volatile times.  

This initiative directly responds to market demand to expand PvP settlement orchestration to additional settlement venues. As part of the proof-of-concept, participants used an asset with the credit characteristics of central bank money, recorded on a DLT ledger, to offer PvP settlement services alongside commercial bank money. This expands settlement options, offers flexibility in selecting Fnality for one or both of the settlement legs and enables around-the-clock settlement orchestration beyond traditional market hours, enabling participants to enhance overall liquidity efficiency. This update is part of a series of enhancements that will see the service mature over the coming months to offer increased flexibility and further options for how and where settlements occur. 

Participants also benefit from continuous, automated payment netting and splitting, seamlessly integrated with on-demand, instantaneous PvP settlement orchestration, delivered to each participant’s selected settlement venue(s). This allows firms to better manage the overall funding burden and liquidity pressures associated with large volumes and large-value settlements, creating additional settlement capacity to support business growth.  

Michelle Neal, CEO of Fnality said, “Joining the OSTTRA and Baton PvP network marks a significant milestone in our mission to make institutional-grade digital settlement a practical reality. This integration is the first step in bringing true PvP capabilities to our customers, enabling them to settle FX transactions using a digital record of funds held at the central bank, and introducing greater choice and flexibility into the settlement landscape. Through Fnality, this collaboration lays important groundwork for more resilient and efficient FX markets by reducing risk, enhancing liquidity, and supporting atomic, instantaneous settlement at any time of day.”

“At OSTTRA, we are committed to continually evolving post-trade efficiency for our clients,” states John Stewart, co-CEO. “Fnality’s introduction of  DLT settlements using an asset with the credit characteristics of central bank money, coupled with extended hours, represents a key milestone in this journey. This strategic enhancement gives users more robust tools to manage risk and optimise their settlement orchestration processes in today’s dynamic global markets.”

Arjun Jayaram, Founder and CEO of Baton Systems, commented: “We’re delighted to partner with Fnality to expand the range of settlement options within the PvP service to address bank liquidity optimisation and risk management requirements. With these enhancements, settlement participants can select the type of asset or system they wish to settle in and settle on a 24×7 basis whilst benefiting from proven capabilities to net and settle large volumes of transactions on a near real-time basis. Ultimately, our goal is to continue innovating and collaborating so we can support firms in settling transactions where they choose, over both digital and traditional payment rails.”

Notes to editors:

This proof-of-concept leveraged the Sterling Fnality Wholesale Payment System Test Environment in GBP. This has demonstrated that the Sterling Fnality Payment System can become a settlement leg for the OSTTRA FX PvP settlement orchestration service. No other currency is currently available in the Fnality ecosystem. 

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About Baton Systems 

Baton Systems is a leading global fintech that has facilitated the settlement of over $17 trillion and processed more than 140 million transactions. Each day, the platform handles $20-30 billion in asset settlements across both cash and securities for some of the world’s most prominent financial institutions. Its cloud-based, multi-asset platforms connect and empower networks in post-trade, payments and settlements. 

Founded in 2016 by Silicon Valley technologists and capital market specialists, Baton Systems is transforming the entire front-to-back post-trade process by introducing interoperable and connected digital market infrastructures designed to increase speed, visibility and control from trade matching through to settlement. 

Find out more at www.batonsystems.com

 

About OSTTRA

The home of industry-shaping businesses MarkitServ, Traiana, TriOptima and Reset, OSTTRA brings the expertise, processes and networks together to solve the post-trade challenges of the global financial markets. OSTTRA strengthens the post-trade infrastructure and ecosystem with robust and progressive end-to-end post-trade solutions and unrivalled connectivity.  

OSTTRA and the OSTTRA logo are trademarks of OSTTRA Group Ltd. Copyright © 2025 OSTTRA Group Ltd. All rights reserved. 

Baton & OSTTRA Media Contact: 

Tim Focas – Aspectus Group – tim.focas@aspectusgroup.com 

 

About Fnality 

Fnality is developing a series of regulated DLT-based wholesale payment systems. Each system, known as a Fnality Payment System (FnPS), is supervised by its respective central bank.  

Within a FnPS, participants utilize a digital representation of funds held at central banks for instant wholesale payments. The launch of FnPSs in key jurisdictions will enable many benefits such as real-time cross-currency payments and the secure atomic settlement of any delivery versus payment transactions around the clock. The credit quality of the central bank funds underpinning Fnality Payment Systems provides the missing ingredient for novel digital asset markets: institutional-grade digital cash.  

In December 2023, the Sterling FnPS, previously recognized by HM Treasury as a systemically important payment system, commenced controlled live payments. Joining a handful of other regulated payment systems in the UK, it became the world’s first regulated DLT-based wholesale payment system, settling with digital representation of funds held at the central bank. From December 2024, the £FnPS has been granted settlement finality designation.  

Fnality’s shareholders comprise: Banco Santander, BNY Mellon, Barclays, BNP Paribas, CIBC, Commerzbank, DTCC, Euroclear, Goldman Sachs, ING, KBC Group, Lloyds Banking Group, Mizuho Financial Group, MUFG Bank, Nasdaq Ventures, Nomura, Sumitomo Mitsui Banking Corporation, State Street Corporation, UBS and WisdomTree.  

For more information, please visit fnality.com  

Fnality Media Contact:  

The PHA Group – fnality@thephagroup.com  

About the author

Fnality Press Team