Australian Securities Exchange Opens Test Environment For Blockchain Settlement System

The Australian Securities Exchange (ASX) has opened a new Customer Development Environment (CDE) that allows clients to test its in-development blockchain-based settlement system.

ASX first announced in December 2017 that it would replace its Clearing House Electronic Subregister System (CHESS) with a distributed ledger technology (DLT) developed by blockchain startup Digital Asset (DA). The new system was originally expected to go live towards the end of 2020. However, the exchange delayed the launch by six months in response to industry concerns over the aggressive implementation timeframe.

The CDE, which was made available to ASX clients on April 30, allows ASX clients to experiment with the new system as well as design, build and test system changes. It also enables clients to access some of the new business functionality, and compare various access options.

“Customers can connect to the new system directly via a DLT node, which provides access to real-time, synchronized, source-of-truth data,” ASX said. “This innovation is designed to reduce costs and complexity, and facilitate new business opportunities for intermediaries, issuers, investors and other users. While ASX encourages this mode of connection, other access options are also available, including the ISO 20022 global messaging standard via AMQP and SWIFT, and a web browser for low volume, infrequent usage.”

According to ASX, additional functionality will be released at approximately eight-week intervals, culminating in full functionality in the CDE by mid-2020.

Cliff Richards, ASX’s Executive General Manager Equity Post-Trade Services, said that delivering the development environment for customers on schedule is a major step forward in ASX’s CHESS replacement journey.

“We are proud of this achievement and very grateful for the support of our partner Digital Asset and our customers,” Richards said. “While we believe distributed ledger technology offers exciting opportunities for the whole market to innovate, there is much still to do. We continue to work closely with our customers as we progress towards delivery of the new system.”

Digital Asset Chief Executive Yuval Rooz said that this is an important milestone for everyone involved in the CHESS replacement project, which continues to proceed according to the implementation timeline set by ASX.

“With the delivery of the CDE, ASX customers get their first glimpse of what the new CHESS system can provide,” Rooz said.

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