FT: ASX under pressure to delay CHESS-blockchain replacement

ASX is under pressure to push back an ambitious plan to use blockchain technology to clear and settle trades in Australian equities because customers are worried about the implications of the rollout. Computershare, one of the main share registry companies in Australia, told the Financial Times it was seeking a two-year delay in implementation because the project to overhaul critical systems lacked clarity.

The company said it had not been given the necessary technical, operational and regulatory information on how the new system would operate or the fees that would be charged by the ASX for existing and new services. Computershare — which maintains a register of legal ownership of shares and distributes corporate dividends for investors — said a delay until April 2023 was required to address the risks of the project, particularly in light of complications introduced by the Covid-19 pandemic.

A delay of this order would be a blow to the ASX, which became the first big stock exchange around the world to commit to using so-called distributed ledger technology — which underpins bitcoin and other digital currencies — for clearing and settlement in 2017. The new system would enable customers “to develop new services and reduce their costs”, and would “put Australia at the forefront of innovation in financial markets”, the ASX said at the time.

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