The Australian Securities Exchange (ASX) is making progress in its efforts to replace CHESS - its clearing and settlement system - with a new system based on distributed ledger technology (DLT).
ASX has expressed interested in DLT since 2015. In December last year, it announced that it would become the world’s first major stock exchange to rely on DLT for post-trade processing, using technology developed by Digital Asset - a blockchain startup headed by Blythe Masters, a former JPMorgan executive.
An 87-page consultation paper released last Friday contained a timeline detailing the new system’s functions and projected launch date - between Q4 2020 and Q1 2021. As of today, the ASX is looking for feedback on its plans. The paper’s introduction states that the “ASX expects to provide a final functional scope and implementation road map in late July 2018”, depending on the extent of consultation feedback received.
In a press statement, Dominic Stevens, Managing Director and CEO of ASX, said:
“We believe that using DLT to replace CHESS will enable our customers to develop new services and reduce their costs, and it will put Australia at the forefront of innovation in financial markets. While we have a lot more work still to do, today’s announcement is a major milestone on that journey.”
By Nadya Astam