Following the steps of Australian Securities Exchange, the Sydney Stock Exchange is now looking into the possibility of implementation of blockchain based trade settlement system. According to recent reports, the Sydney Stock Exchange has entered into a joint venture with Bit Trade Labs, a blockchain, and distributed consensus systems based solutions provider to develop the blockchain based equities market settlement and registration system.
The blockchain based trade settlement systems are made up of smart contracts, that are pre-programmed to be executed under suitable conditions once the basic criteria for execution are met. This will allow the financial institutions to initiate and conclude the trade settlement process within minutes after the trade is executed. Sydney Stock Exchange will initially be using the system for its own equities and private markets before it is made available for other market operators.
The joint venture was made public recently at the Practical Blockchains event, which was co-organized by Sydney Stock Exchange, Bit Trade Labs, and the Australian Digital Currency Commerce Association.
The ability of blockchain technology based solutions to automate various processes while maintaining records for compliance and regulatory purposes is well known to all of us. These very properties are now being used by banking and financial institutions to develop and deploy blockchain based solutions. The international banking consortium figures among the top ones in the list to start working on a blockchain based solution along with R3CEV. Recently, Australian Securities Exchange, in association with Digital Asset Holdings has also implemented a trade settlement system.
As the list grows, we can soon expect more and more trading platforms and stock exchanges across the world to start using blockchain technology, keeping up with the changing technology landscape. Supporting these initiatives are other leading tech companies like Microsoft, IBM, Red Hat and others who are offering the required infrastructure and support services for development and large scale implementation of the technology.