The ASX Will Go Head With Blockchain Technology

blockchain technology

They had until December and they didn’t disappoint.

The ASX Ltd [ASX:ASX] was in need of replacing their CHESS system, the system that records holdings, executes trades and settles them.

It was world leading technology in the 1990s. But in 2017, not so much.

That’s why the ASX has been testing distributed ledger technology for the last two years. And this morning they finally came to a decision.

They will replace their CHESS system with distributed ledger technology.

ASX’s Blockchain Boost Will Benefit Users

Digital Asset Holdings is developing ASX’s distributed ledger. It will work similar to the blockchain that bitcoin trades on. But it will have key differences.

Unlike the blockchain, ASX’s ledger doesn’t need to confirm transactions via a consensus mechanism. Instead, the system will be a private network.

It will also give ASX customers choice as to how they use ASX’s post-trade services,’ the ASX said.

Customers will be able to connect in a similar way they do today, with the addition of using contemporary global ISO 20022 messaging, or they may interact directly with the distributed ledger.

ASX CEO Dominic Stevens said:

Having completed this work, we believe that using DLT (distributed ledger technology) to replace CHESS will enable our customers to develop new services and reduce their costs, and it will put Australia at the forefront of innovation in financial markets. While we have a lot more work still to do, today’s announcement is a major milestone on that journey.


Härje Ronngard,

Junior Analyst, Money Morning

PS: If you’d like to know more about blockchain technology and the secret world of bitcoin, click here.

Harje Ronngard

Harje Ronngard

Harje Ronngard is the lead Editor at Money Morning. With an academic background in finance and investments, Harje knows how simple, yet difficult investing can be. He has worked with a range of assets classes, from futures to equities. But he’s found his niche in equity valuation.

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