The Australian Securities Exchange (ASX) has postponed the launch of its long-awaited distributed ledger technology (DLT) trading system due to “uncertainty” prompted by the coronavirus outbreak.
The Sydney-based stock exchange paused the launch plans for its new DLT-based system that would provide same-day settlements for trades on Wednesday. Originally scheduled for April 2021, consultation on a new implementation timetable, including a new launch date, will start in June, the exchange confirmed in a statement Wednesday.
With the new coronavirus now rapidly spreading in Australia, ASX Deputy CEO Peter Hiom said the exchange’s priority was now to monitor daily events and “focus on day-to-day operations.” Waiting until June before drawing up a new schedule would give the ASX “more time to consider the replan and better assess the implications of COVID-19,” he added.
This is the latest installment in a 4.5-year saga for ASX, which first toyed with the idea of replacing its aged Clearing House Electronic Subregister System (CHESS) with a DLT alternative in October 2015.
ASX announced a successful first trial in 2016 and finally confirmed it would replace CHESS with a DLT-based system in December 2017. An original launch date was scheduled for Q1 2020, but was then postponed until Q2 2021. In its annual report, published August 2019, ASX said it was “on track” to complete the system in time for that date.
ASX said Wednesday it would utilize the extra time to work on the system’s operational readiness, review possible changes to its rules of operation and allow back-end engineers to become more familiar with the system ahead of launch.
Plans to trial the new DLT trading infrastructure in an Industry Test Environment (ITE) are still on target for July.
“ASX remains fully committed to CHESS replacement,” Hiom added. “The investments we are making in the new system and in distributed ledger technology are for the long-term benefit of the financial services industry and the Australian economy.”
Last month, the National Stock Exchange of Australia – ASX’s rival – said it was building a digital securities platform to launch in the early part of 2021. Managing director and interim CEO John Karantzis told CoinDesk they were still on track as most of their engineers were able to work remotely and remain unaffected by the coronavirus outbreak.
UPDATE (Mar. 26, 09:35 UTC): This article has been updated to include comment from John Karantzis, managing director and interim CEO of NSX.