Australian Security Exchange Abandons Blockchain for Software Rebuild

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Key Takeaways

  • Till now, ASX has hinted that it might resurrect the project using blockchain-based technology developed by Digital Asset.
  •  AXS has now sent a request for information to potential software vendors and issued an RFP to a number of vendors for more detailed feedback

Australia’s stock market operator- Australian Securities Exchange (ASX), announced its plans to abandon attempts to rebuild its software platform with blockchain-based technology.

Over the past five years, ASX has dedicated its efforts to developing a distributed ledger technology (DLT) solution as a replacement for its outdated Clearing House Electronic Subregister System (CHESS). CHESS, which has been in use for 25 years, is responsible for recording shareholdings and facilitating transaction settlements.

ASX’s pursuit of a DLT-based solution was driven by the potential benefits offered by blockchain technology. The use of DLT would have allowed for more efficient and secure recording of shareholdings, streamlined transaction settlements, and enhanced transparency for market participants.

However, in November last year, the company decided to “pause” the rebuild of its comprehensive trading, settlement, and clearing software based on decentralized computing.AXS has then argued that the DLT-based system was too complex, adding that the completion timeline was uncertain irrespective of the application software being over 60% complete.

Reportedly on May 17, the company stated it would not incorporate blockchain or any related distributed ledger technology (DLT).

In the meeting, participants were informed by Project Director Tim Whiteley that ASX is making progress towards finalizing a new strategy by the end of the year. As part of this process, the company has taken steps to gather information and feedback from potential software vendors.

ASX has sent a request for information to potential software vendors, seeking details and insights into their offerings. This allows ASX to gather a broad range of information about available technologies and solutions that could potentially meet their requirements.

Additionally, ASX has issued a request for a proposal (RFP) to interested parties. The RFP invites vendors who have expressed a positive interest to submit comprehensive proposals that outline their proposed solutions, implementation plans, and other relevant details. This enables ASX to obtain more detailed and specific feedback from vendors regarding their capabilities and how they align with ASX’s needs.

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Saniya Raahath
Saniya Raahath

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