Blockchain Rejection: ASX Discontinues Software Rebuild
Australia’s leading stock market operator, the Australian Securities Exchange (ASX), has officially ended its plan to reconstruct its software platform using blockchain technology. This decision, announced on May 17th, marks a major departure from the decentralized computing concept that has been closely associated with cryptocurrencies.
A Long Road to Abandonment
In November 2022, the ASX caused market unrest by announcing a “pause” on the comprehensive trading, settlement, and clearing software rebuild project. This followed an external review concluding that significant rework was necessary after seven years of development. The project was a notable effort to streamline online transactions by processing them securely across multiple locations.
Exploring More Traditional Paths
Now, ASX has declared it is considering alternatives for a new software rebuild. However, it will be moving away from blockchain and other related distributed ledger technologies (DLT).
Project Director Tim Whiteley confirmed during a meeting that while all options are being explored, the focus will likely shift towards more conventional technologies to achieve their business goals.
World’s First Blockchain-Powered Securities Exchange – No More
The abandoned project was expected to make the ASX the world’s first securities exchange to implement blockchain technology in its core services. The technology was to be supplied by the New York-based contractor Digital Asset, in which the ASX had invested after engaging the firm for the software rebuild in 2016.
Towards a New Strategy
Whiteley disclosed that ASX is progressing toward devising a new strategy by year’s end. It has reached out to potential software vendors and invited proposals from interested parties to gather a wide range of feedback.
The market participants have voiced their preference for a less risky approach, advocating a gradual transition to new software rather than a sudden switch. This feedback has been taken into consideration during the implementation planning process, ensuring the next steps align with market expectations and standards.