ASX confirms one-year delay to DLT post-trade system

The post-trade blockchain project at ASX has been pushed back by one year as the exchange faced pressure from users to delay the launch.

The Australian Securities Exchange (ASX) will delay the replacement of its CHESS equities clearing and settlement system with a new distributed ledger technology (DLT) system by one year.  

The delay followed pressure by users for the exchange operator to push back the plan amid reported concerns that the initiative lacked clarity on how the system will operate. ASX had said the new target launch date will now be April 2022, subject to user feedback.

“ASX has undertaken a comprehensive, risk-based approach to the re-plan of the CHESS replacement project. We have listened to the diverse views of stakeholders and accommodated feedback on timing, user readiness and changes to functionality,” said Peter Hiom, deputy CEO at ASX.

“We are approaching an important and exciting phase of the project, involving close collaboration between ASX and CHESS users, as they test their systems and begin operational readiness activities. In developing the revised implementation plan, ASX has been very mindful of the challenges the industry faces during the COVID-19 pandemic.”

In March, ASX was forced to halt the initial April 2021 implementation of the DLT system due to the operational pressures and heightened volatility caused by the global COVID-19 pandemic and subsequent lockdowns.  

The ASX added in confirming the fresh delay that it had already made significant progress in a number of areas, including a rollout of the distributed ledger into several technology environments across multiple data centres.

“The recent period of record trading activity and volatility, and the prevalence of manual and paper-based processes in many back offices across the industry, have underlined why the implementation of the next generation of technology to support the digitisation of Australia’s equity market is a priority,” added Hiom.