Scenarios for Industry Adoption of the ISDA Common Domain Model

Implementing a standard data model such as the ISDA Common Domain Model is vital for the financial industry moving to the next generation of digitalization. Now how can such a standard be adopted in practice by the industry ? This is the question adressed in an insightful paper published on 13 July 2020 by Aishwarya Nair and Lee Braine of the Chief Technology Office of Barclays : Industry Adoption Scenarios for Authoritative Data Stores using the ISDA Common Domain Model.

Here is the abstract with the promise of much more detailed take-aways in the paper itself.

We start by summarising relevant industry problems (inconsistent processes, inconsistent data,and duplicated data) and the corresponding potential industry solutions (process standardisation, data standardisation, and authoritative data stores).

This includes transitioning to the International Swaps and Derivatives Association (ISDA) Common Domain Model (CDM) as a standard set of digital representations for the events and processes throughout the lifecycle of a trade.

We then explore how financial market infrastructures could operate authoritative data stores that make CDM business events available to broker-dealers, considering both traditional centralised models and potential decentralised models. For both models, there are many possible adoption scenarios (depending on each broker-dealer’s degree of integration with the authoritative data storeand usage of the CDM) and we identify some of the key scenarios.

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