Market - - Dec 07,2017
As per Australia's main stock exchange, it is ready to become the first worldwide market to access the blockchain technology associated with Bitcoin for settling trades.
On Thursday, the Australian Securities Exchange (ASX) said it would implement the use of blockchain for managing trades. This would make the Australian stock exchange the world’s first mainstream equity market that will actively deploy the technology behind bitcoin to handle its core services.
It points out to the fact that, ASX would swap its decades-old clearing and settlement system called as the Clearing House Electronic Subregister System (CHESS) with blockchain technology. The aim here is to reduce costs for customers until next March, as said by the stock exchange.
The blockchain is a technique of recording data through a digital ledger of transactions, contracts, agreements or anything which needs to be independently recorded and sanctioned as having happened. ASX chief executive Dominic Stevens stated the move to utilize blockchain will place Australia at the “forefront of innovation” across financial markets.
In January 2016, the Australian stock exchange announced that it registered US-based blockchain startup Digital Asset Holdings for the development of a new system that would help in clearing and settling trades. Almost two years of testing, this recent announcement is seen as a major milestone considering the global competition to organize blockchain, also termed as distributed ledger technology, across large-scale financial markets.
According to experts, the application of blockchain for clearing and settling can work to make transactions quicker, easier and cheaper in comparison to traditional systems. Goldman Sachs stated, the utility of blockchain for stock trading might help the industry safeguard $6 billion annually all around the globe.