Q&A with Denis Dounaev, Product Owner at the DTIF

As part of our work on Digital Assets, ANNA has collaborated with the Digital Token Identifier
Foundation (DTIF) to allow the phased introduction of new ISINs to identify crypto assets to further
optimise and automate more comprehensive data sets within both ISO standard registries. We
recently interviewed Denis Dounaev, Product Owner at the DTIF, a non-profit division of Etrading
Software, Registration Authority (RA) for 24165 Digital Token Identifier (DTI) standard. Denis has
extensive experience in the technology and crypto world, oversaw the implementation of the DTI
standard and continues to oversee the DTIF’s operational and strategic goals. Within his role as a
representative of the RA, Denis is also a member of TC68-SC8-CAG and acts as a secretary of WG3.
He shares some of his knowledge about how financial standards are working to improve
transparency. He talks about the role of the Digital Token Identifier (DTI), the DTIF’s collaboration
with ANNA, and how standards are key in the global marketplace.

Almost two years after being published as an ISO standard, the DTI is undergoing a review—what
changes can be expected as part of this?
The advances in crypto technology, tokenisation innovation and regulatory changes mean the
standards must be reviewed regularly to ensure they are still relevant to the industry. Since the
standard was written and went live, the crypto industry has gone through many ups and downs: the
rise and fall of the popularity of NFTs, the collapse of FTX, Terra and “Crypto Winter”, to list a few.
WG3 (ISO working group responsible for maintaining the DTI standard) (Technical Committee 68
(ISO/TC 68) is responsible for creating global standards for the financial services industry) has
decided to review the standard after receiving feedback from members of ISO.

In the case of the ISO for DTI, DTIF noted some points in the standard which required clarification
following discussion at the Product Advisory Committee and asked the ISO Working Group to revise
the standard within a year rather than waiting for the five-year cycle.

The primary consideration of this review is to ensure that any existing users are not impacted, so all
the proposed changes will be backward compatible. The main changes include:
– Inclusion of NFTs to the standards
– Separation of identifier between native digital token and the ledger it is on
– Addition of issuer and/or maintainer to the informative data elements
– Addition of fungibility reason to the Functionally Fungible Group
– Review of normative data elements for “Other” DLT type

Since the assignment of the first DTI, what have been some of the key milestones reached and
what is being undertaken to increase adoption of the DTI?
We have reached a milestone of 1,000 identifiers in 2022 and are on course to double that in 2023.
Over the same period, the DTI has been adopted into the FIX and SWIFT protocols, and by
institutions such as Swiss Digital Exchange.

There has also been increased activity from regulators in terms of consultations since DTIF was
established. In March 2023, ESMA recommended the DTI as a compensatory measure under its DLT
Pilot Regime. In October 2023, ESMA published a new consultation referencing the potential use of
DTIs under MiCA.

In November, together with ANNA, we announced an MOU between the Registration Authorities
and as part of that issued the first set of XT ISINs based on DTIs.

DTIF and ANNA are collaborating to develop an ISIN – DTI standards solution—what is the driver
for this, and how can the market expect to benefit?

The financial industry has been using ISIN for over 40 years, and the institutions and regulators
understand it and are comfortable using it. In the DTIF, we were always mindful of this and in early
2021 established a joint task force with ANNA to understand how DTI and ISIN can operate in a
complementary way. Our main focus was to provide the regulators and the industry with more tools
to monitor digital assets and reduce potential overheads.

We came up with the best of both worlds: complimentary, interoperable identifiers with different
functions but intrinsically linked that work together to bring more transparency to the Digital Asset
market.

The ISIN is the global standard for unique identification of financial and referential instruments
helping organisations meet regulatory requirements and improve transparency, stability and
efficiency. It is a familiar identifier for financial institutions, and there is infrastructure in place to
accommodate and process ISINs

The DTI is a global standard for unique identification for all fungible digital tokens, providing
guaranteed uniqueness of the digital token based on objective, verifiable technical data. It identifies
the digital token’s location on a public or private blockchain and directly links to underlying assets as
part of the metadata.

Many countries have progressed in developing regulations and frameworks for digital
assets—what role do standards play?

Standards are the key to unlocking efficiencies of any market, providing the common language for
the participants. There are many different standards that the digital asset industry has to accept
globally to reap the full benefits of tokenisation and crypto: message structure, classification &
taxonomy, smart contract components, etc. However, the first step must be a common way of token
and asset identification; this is where DTI and ISIN come in.

For regulators, the advantages of having global standards for identification are clear, they provide
consistency and help to track the trades across jurisdictions and DLTs, and thus help with monitoring
for illegal activities. For market participants, the identification standard helps with effective risk
management by tying the asset directly to the DLT on which it has been issued.