CoinDesk
The Solana Foundation launched Solana DvP, an open-source program that settles asset and payment transfers together on-chain in seconds rather than days. The externally audited standard is designed to reduce counterparty risk and replace custom settlement contracts. JPMorgan contributed settlement expertise to its development.
Why it matters
Delivery-versus-payment, or DvP, makes both sides of a trade settle in one atomic transaction: either the asset and payment transfer together, or neither does. That differs from traditional settlement, where assets and cash can take one to two days to move through clearinghouses and custodians, tying up capital and leaving room for one party to default after receiving the other side’s delivery.
A shared, open standard could also reduce the need for institutions to commission one-off smart contracts for each on-chain trade. JPMorgan’s input helped shape requirements including deadlines, escrow isolation and token extensions used by regulated issuers, such as pausable tokens and transfer hooks under Solana’s Token-2022 standard.
Market impact
The Foundation says Solana DvP has passed external security audits and is ready for real funds. It plans to add privacy features sought by institutional market participants, a capability that could matter as firms assess whether public blockchain settlement can meet their confidentiality needs.
Solana has already been used in institutional tokenization experiments, including a J.P. Morgan-arranged commercial paper deal for Galaxy Digital settled in USDC. A common settlement program could give future transactions a reusable foundation, though broader adoption will depend in part on institutions’ privacy requirements.
Frequently asked questions
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How does Solana DvP reduce settlement risk?
It settles the asset and payment together in one atomic transaction. Either both transfers complete or neither does, reducing the risk that one party delivers while the other defaults.
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How long can traditional settlement take compared with Solana DvP?
Traditional settlement can take one to two days as assets and cash move through clearinghouses and custodians. Solana DvP is designed to settle in seconds.
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What did JPMorgan contribute to Solana DvP?
JPMorgan provided settlement expertise and helped shape requirements around deadlines, escrow isolation and token extensions used by regulated issuers.
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Has Solana DvP been audited and is it ready for real funds?
The Solana Foundation says the program has passed external security audits and is ready for real funds.
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Why are privacy features planned for Solana DvP?
Institutional market participants have identified privacy as important for blockchain adoption. The Foundation plans to add features that allow settlements to remain confidential.
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