Australian Securities Exchange To Embrace Blockchain Technology

The blockchain technology is creating ripples in the global financial sector. Industry leaders are recognising the “potentially disruptive” technology which can completely revolutionise the financial sector.

According to recent reports, the Australian Securities Exchange (ASX) is considering replacing its existing clearing and settlement system with blockchain technology.

The blockchain technology is nothing but a decentralized public ledger that no one person or company owns or controls; users control it directly. The technology is not just limited to bitcoin but has much broader applications.

ASX Managing director Elmer Funke Kupper said that the blockchain could help reduce cost, save time and simplify the clearing and settlement of trades, presently being done by a system known as the Clearing House Electronic Subregister System (CHESS), The Sydney Morning Herald reported.

"We see CHESS replacement as a one-in-20-year opportunity," Mr Funke Kupper said. "We're thinking about whether there are smarter ways to do things – to remove a lot of administrative costs and reconciliation costs from the back end of investment banking and broking, and this is where blockchain could be potentially quite helpful."

The SMH further said that the upgrade of the ASX clearing and settlement system will begin by the end of 2016.

"We are replacing all our systems; we would like five years of peace to do all of that.," Mr Funke Kupper said.