Austrailia’s largest stock exchange
The ASX, released a press statement today announcing that they will begin a switch from their own clearinghouse onto a new clearinghouse that is powered by the blockchain. The new clearinghouse will begin using the blockchain tech to clear and settle trades. This move has been in the works since January 2016, when the ASX began working with US-based blockchain startup Digital Asset Holdings to develop a blockchain-based system. The exchange will outline its transition to the new technology in March.
In the first paragraph the ASX says:
CHESS (Clearing House Electronic Subregister System) is the system used by ASX to record shareholdings and manage the clearing and settlement of equity transactions in Australia. It was world-leading when introduced in the 1990s, providing name-on-register functionality, electronic communications and removing paper share certificates. It continues to be a robust and reliable system. ASX is now taking the opportunity to replace CHESS with a next generation post-trade platform using contemporary technology.
The change comes at a time where blockchain technology and cryptocurrencies are seeing a huge rise in popularity. But is this simply a fad? Using blockchains to clear transactions is the ultimate goal that has been touted off since the creation of Bitcoin. Every Hodler has been waiting for the actual adoption of blockchain technology and it looks like 2018 will be the year of the blockchain. But this isn’t the first time ASX has dealt with the blockchain. According to the Managing Director for the ASX, Dominic Stevens, blockchain technologies have been on their mind for over 2 years.
ASX Managing Director, said: “ASX has been carefully examining distributed ledger technology for almost two-and-a-half years, including the last two years with Digital Asset, in order to understand its potential application. Having completed this work, 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.”
2018 the year of the blockchain
The ASX obviously did not create their own blockchain for the ASX, instead, they partnered with Digital Asset, a blockchain technology company who helped get ASX running with blockchain. According to Digital Asset’s CEO, Blythe Masters, he said:
“After so much hype surrounding distributed ledger technology,
today’s announcement delivers the first meaningful proof that the technology can live up to its potential.
Together, DA and our client ASX have shown that the technology not only works, but can meet the
requirements of mission-critical financial infrastructure.”
Bringing home the point that DLT (Distributed Ledger Technologies) or blockchain technology, can pave the way for the future generations of digital assets trading.