Solana Launches Institutional Settlement Program with J.P. Morgan Input
The Solana Foundation has introduced Solana DvP, an open-source program designed for institutional trade settlements. Launched on October 6, this delivery-versus-payment (DvP) system enables atomic settlements on-chain, reducing the process from days to seconds. The program, developed with input from J.P. Morgan, aims to replace bespoke smart contracts with a standardized solution for institutional trades.
Solana DvP is built to ensure that both legs of a trade are settled simultaneously, eliminating the risk of one party failing to pay while the other delivers assets. Traditional markets rely on clearinghouses and custodians for this process, which can take up to two days and incur significant costs. In contrast, Solana DvP claims to offer finality in under a second and transaction costs of less than $0.01, according to a reference implementation provided for educational purposes.
J.P. Morgan contributed insights on settlement requirements, emphasizing the need for deadlines, escrow isolation, and token extensions for regulated issuers. Rhodel D'souza, head of markets digital assets at J.P. Morgan, highlighted the importance of a shared standard for atomic DvP settlements to reduce counterparty risk. The Solana Foundation has stated that the program has undergone external security audits and is ready for use with real funds, although no settlements have been publicly recorded yet.
The program supports SPL Token and Token-2022, including extensions like permanent delegate, pausable tokens, and transfer hooks, which are critical for regulated institutions. Solana has previously been involved in similar initiatives, such as a J.P. Morgan-arranged commercial paper deal settled in USDC. The next step for Solana DvP will be to identify a named design partner or record a visible transaction on a Solana explorer.