ISIN-DTI Complementary Standards Bridging Traditional and Digital Markets

ANNA/DTIF Proud Partners of 5th PBW

Quick links

    ISIN-DTI: The Best of Both Worlds

    ISIN: Asset Level Identifier

    Global standard for unique identification of financial and referential instruments helping organisations meet regulatory requirements and improve transparency, stability and efficiency

    Familiar identifier for financial institutions

    infrastructure in place to accommodate and process ISINs

    DTI: Token Level Identifier

    Global standard for unique identification for all fungible digital tokens providing guaranteed uniqueness of the digital token based on objective, verifiable technical data.

    ✓  Identification and location of the digital token on a public or private blockchain

    ✓  Direct link to underlying assets as part of the metadata

    DTI/ISIN: Complementary Identifiers

    Complimentary, interoperable identifiers, with different functions but intrinsically linked, that work together to bring more transparency to the Digital Asset market.

    DTI to ISIN Link

    XT ISIN Scope

    Crypto assets that are not financial instruments in accordance with ISO 10962 CFI classification are treated as referential instruments and therefore are in scope for XT ISIN allocation.

    • Note 1: Jurisdiction-agnostic approach has been applied due to regulatory divergence in the treatment of crypto assets across jurisdictions.
    • Note 2: Centralised approach has been applied due to an absence of clear definition and identification of an issuer for such referential instruments.
    • Note 3: NFTs are currently out of scope and will be addressed at a future date (this does not apply for financial instruments issued in NFT form).
    • Note 4: Existing referential instruments for which ISIN allocation rules already exist are not in scope for XT ISIN

    Benefits of the approach

    • Centralise allocation to facilitate harmonization, reduce duplication of effort and strengthen building of expertise
    • Keep high data quality: avoid more than one ISIN per crypto asset
    • Facilitate interoperability between different ISO standards: ISIN & DTI
    • Preserve established federated model of ISIN allocation where it’s currently in place today
    • The allocation of an ISIN represents the identification of an instrument rather than the market an instrument trades on or DLT it is created on. As such, any digital instruments that are fungible (i.e. considered to be equivalent) will be identified by one ISIN.
    • DTI represents an individual token per DLT, with fungible assets grouped into a Functionally Fungible Group (FFG) with its own DTI. As crypto markets are continuing to move towards interoperability, a vast majority of tokenised instruments are part of the FFG through either a technical solution (bridging) or user guaranteed issuance (pegging).
    • There is one to many relationship between the ISIN and DTIs: each ISIN maintains the link to the FFG DTI and each DTI within that group.

     

    DTI Background

    • ISO 24165 (DTI) standard published by ISO September 2021.
    • Etrading Software (designated Registration Authority) established DTIF to implement the standard.
    • In scope are all fungible digital assets which use distributed ledger technology for their issuance, storage, exchange, record of ownership, or transaction validation.
    • To date approximately 2,100 DTIs have been issued.
    • Recommended to be used under ESMA DLT Pilot regime.
    • Considered to be used as an identifier under MiCA regulatory regime.

    ANNA Background

    • ISO 6166 ISIN has been the global standard for unique identification of financial and referential instruments for 40 years
    • ANNA established internal taskforce 2019 to assess the role of ISINs for digital assets
    • Taskforce recommendations:
      • Tokenized financial instruments in scope for ISIN
      • Other tokens in scope for ISIN as referential instruments/underlyings for financial instruments
      • Ensure complementary relationship with DTI
      • Establishment of a permanent working group for digital assets
    • ANNA Working Group
      • ISIN Guidelines for digital assets
      • Defining model and implementation for ISIN allocation
      • Ensuring ISIN:DTI relationship
      • Monitoring market developments
    • ISINs for tokenized financial instruments remain with National Numbering Agencies (NNAs)
    • Tokenized referential instruments to be allocated ISINs via centralized model with XT ISIN prefix.

    Task Force

    ANNA-DTIF task force has been established in March 2021 with the following objectives:

    1. Whether there is scope for the DTI code to be embedded, linked or aligned, in a complementary nature with ISIN issued by ANNA or NNAs, where both identifiers represent the same digital token
    2. Whether there is scope for incorporating some of the metadata elements of each identifier within the record of the other identifier
    3. Whether there is scope for automatic notification by each party to the other when a relevant identifier is created
    4. Whether efficiency gains can be achieved in the assignment processes of each identifier through mutual collaboration
    5. Whether there are any other areas of collaboration to aid in interoperability of the respective identifiers to provide additional benefits to market participants

    Task Force Proposed Principles

    1. ANNA to assign ISINs for tokenized referential instruments until a sole numbering agency under an ANNA established governance framework is designated.
    2. DTIF and ANNA would establish a notification process when an identifier has been issued that could be in scope for both identifiers.
    3. ANNAs will continue to issue ISINs on all jurisdiction-based tokens.
    4. The way metadata is placed in DTI and ISIN records should be consistent between jurisdiction and non-jurisdiction tokens unless there is a good reason for divergence.
    5. The issuance process for tokenized ISINs and DTIs should be consistent between jurisdiction and non-jurisdiction tokens unless there is a good reason for divergence.
    6. ISINs issued by ANNA would include links to the DTI for technical identification of Digital Assets, as well as the necessary data attributes needed for the ISIN, CFI and FISN data sets.

    Examples

    Bitcoin

    • FISN: BITCOIN/BTC
    • ISIN: XTV15WLZJMF0
    • DTIs: (V15WLZJMF);4H95J0R2X;ZN227BVRW

    TetherUSD

    • FISN: USD TETHER/USDT
    • ISIN: XTL09Q657BK6
    • DTIs:
      • Functionally Fungible Group (FFG): L09Q657BK
      • Tokens in FFG: 75T0GP5WJ;2QWSBDMNC;NJ7X4BCTD;PJ1BC8W44; C9N6ZVN7S;Z7ZX774BJ;FZP9CBTG1;PDX13MN94; BHQ70PZ11;6QBMW6DQZ;JGJZPPF7Z;NSTDLD1N5; TZFM5MHWR;29DD3R2SH

    Next Steps

    • DTI and ISIN registries cited above will be maintained with ISIN-DTI mappings accordingly and updated periodically.
    • New security tokens and related DTIs as issued
    • Assignment of XT ISINs will be continued in a phased approach
    • ANNA and DTIF will continue to promote the initiative In order to gather valuable insights, perspectives and feedback from industry stakeholders

    Contacts & Resources

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