Hong Kong Stock Exchange Working With Australian Counterpart On Blockchain
The Hong Kong Stock Exchange (HKEX) has initiated a dialogue with the Australian Securities Exchange (ASX) to learn from its experience in settling transactions over a blockchain system.
In December 2017, ASX announced that it would begin using blockchain to replace its current processing system for equity transactions, making it the first such exchange to do so. The blockchain platform was developed by New York-based Digital Asset, which sees the ASX as an investor and equity holder.
Charles Li, head of the HKEX, said that HKEX and ASX are “developing a much closer dialogue to understand what they’re doing, and sharing information…for sharing vendor relationships.” The HKEX is keen on using blockchain technology in a number of areas, including stock borrowing and lending as well as over-the-counter trade transactions.
Previously, the HKEX had started its own blockchain private market initiative to help finance smaller enterprises. However, a lack of viable software vendors and an aversion to in-house blockchain development kept the HKEX from implementing the technology.
“Unfortunately, this space changes so much that the vendors we chose… eventually evolved such that they’re not really useful to us, and we’re not interested in doing it ourselves,” Li said.
That said, Li is still optimistic that the current collaboration with ASX will bolster the exchange’s technological progress and vendor relationship.
“The exchange can come out and say, ‘Let’s use this cheap technology to do something that doesn’t affect the central order book,’ ” Li said.
