Key Takeaways:
- The Asian Development Bank (ADB) has launched a project. The project is launched to make cross-border securities transactions in Asia and the Pacific more efficient and secure.
- It will be made more efficient and secure through the use of blockchain technology.
- The project launched by Asian Development Bank (ADB) will be carried out in 2 phases.
- The first one will be a designing phase which is expected to be completed by the end of March 2022.
- The second one will be a prototyping phase which is scheduled for the second quarter of 2022.
The Asian Development Bank (ADB) has launched a project. The project is launched to make cross-border securities transactions in Asia and the Pacific more efficient and secure. It will be made more efficient and secure through the use of blockchain technology. In collaboration with leading blockchain companies, ADB will seek to develop ways to directly connect central banks and securities depositories in the ASEAN+3 region within a blockchain network. The region consists of the Association of Southeast Asian Nations plus Japan, the People’s Republic of China, and the Republic of Korea.
Directly connecting institutions within a blockchain network could lower transaction costs while also reducing settlement risks and the possibility that securities are not exchanged within an agreed time frame. Cross-border securities transactions in the ASEAN+3 region are currently handled by a global network of custodians and correspondent banks, with global centres in either the United States or Europe. Due to time differences and varying operating hours for markets within the same time zone, intraregional transaction settlements in ASEAN+3 take at least two days.
The project launched by Asian Development Bank (ADB) will be carried out in 2 phases. The first one will be a designing phase which is expected to be completed by the end of March 2022. The second one will be a prototyping phase which is scheduled for the second quarter of 2022. The results will be discussed with ASEAN+3 government officials and members of the Cross-Border Settlement Infrastructure Forum of the Asian Bond Markets Initiative. ASEAN+3 government officials and members of the Cross-Border Settlement Infrastructure Forum of the Asian Bond Markets Initiative is made up of central banks and securities depositories from across the region.
ADB is collaborating with ConsenSys, Fujitsu, R3, and Soramitsu on the project. The project will also look into system interoperability and the viability of central bank digital currencies in the region. The project is funded by the Asian Development Bank’s Digital Innovation Sandbox programme. It provides a platform for public and private sector partners to collaborate on digital solutions. The Asian Development Bank is dedicated to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific. They are dedicated while continuing to fight extreme poverty. It was established in 1966 and it is owned by 68 members and 49 of them are from the region.
