Morningstar, the Chicago-based assessment giant, loves DLT. And is planning to track blockchain-based debt securities.
According to Forbes, Morningstar will soon launch new initiatives. Particularly, it will start scoring blockchain-based debt instruments. A big number of short-term loans are already supporting them.
The report says that Morningstar has already started cooperation with some companies. These businesses are dealing with blockchain-based securities. So Morningstar aims “to build a bridge between the global debt securities industry which has an estimated value of $117 trillion.”
What is Morningstar’s attitude toward the crypto world?
Michael Brawer, COO at Morningstar, said: “We’re looking to see how we can also provide credit opinions, whether it’s a credit rating or different types of credit data and credit analytics that accompany those debt instruments. And we’re also looking to provide our services on a blockchain.”
And these are not just words. The first developments are already under way. Thus, they are currently working on the oracle for the rating mechanism on Ethereum. The plan is to complete it by the end of 2019. They also implement inputs and outputs to their internal rating schemes accessible on the public blockchain. Hence, it will allow investors to make direct testing at a certain fee, hopefully, all will be in place by late 2020.
The company believes blockchain has a huge potential. Why? “Because data stored on a blockchain is updated in real-time, this technology could make the credit rating process more transparent and efficient.”
Morningstar’s growing interest in blockchain makes it a pioneer company among rating institutions that are adopting the benefits of the crypto industry. This approach will inevitably attract the attention of other agencies from this segment.
Morningstar was established in 1984 and specializes in investment researches. The company is the main competitor of the three major credit score agencies in the USA. These are S&P, Moody’s Investors Service, Fitch Ratings. All of them provide research and ratings of structured debt products, including mortgage-backed securities and asset-backed securities.