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Australian Securities Exchange To Delay DLT Transition By 12 Months To April 2022

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The Australian Securities Exchange (ASX) has further delayed its planned transition to a blockchain-powered platform as the replacement for old system amid the continuing uncertainty created by the coronavirus (COVID-19) pandemic. ASX now intends to go live in April 2022.

ASX said a number of factors, including the pandemic itself, created a need to revise the implementation timetable. It had revealed in March that it is now replanning the implementation timetable for the CHESS replacement system and called for formal user consultation in June 2020.

The user consultation is open for four weeks with responses due by July 28, 2020. ASX said regular industry-wide engagement and collaboration are critical to the CHESS replacement project, and thanked users for their ongoing input and support.

This revised timetable has also enabled ASX to assess the impact of the pandemic, requests for functionality changes, and the ability of all ASX and CHESS users to commence the operational readiness phase of the project, the exchange noted.

In August 2019, ASX had expressed its intention to use blockchain in its operations in Australia and New Zealand after teaming up with New York-based blockchain developer Digital Asset and cloud computing software provider VMware.

ASX is developing a DLT-based system to replace the exchanges 25-year old Clearing House Electronic Subregister (CHESS) system. ASX had already delayed the time frame to go-live with the new DLT-based system to April 2021 from the initial plan to go-live in the fourth quarter of 2020.

ASX commenced the process of evaluating replacement options for CHESS in 2015. In January 2016, ASX selected Digital Asset as a technology partner to develop, test and demonstrate to ASX a working prototype of a post-trade platform for the cash equity market using DLT.

The DLT-based system is expected to bring greater benefits such as better record keeping, reduced reconciliation, more timely transactions, and better quality data.

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