A public consultation paper released by the ASX outlines planned new features, alongside a two-and-a-half year implementation plan. The paper confirmed that The ASX will use a new distributed ledger technology to manage the Australian financial market and will introduce 50 new features that will lead to cost reductions.
The new system will allow settlement participants on both sides of a bilateral transaction to pre-match the transaction earlier in the settlement period without committing the transaction for settlement. New York-based fintech company, Digital Asset is building DLT products, is the main technical partner for the initiative.
For the last 25 years, CHESS has been the core system for clearing, settlement, asset registration, and other post-trade services critical to the orderly functioning of the market. ASX said: “CHESS continues to be stable and to effectively deliver these services. While there is nothing to indicate that CHESS will not continue to provide this service level, ASX is replacing CHESS with distributed ledger technology (DLT) which will provide a broader range of benefits to a wider cross-section of the market.” […]