ASX says CHESS replacement with DLT-based system on track

Maria Nikolova

The new system now has a target live date of March/April 2021.

ASX has earlier today published its 2019 Half-Year Results, including an update on the progress in replacing its Clearing House Electronic Subregister System (CHESS) with a new system based on Digital Asset’s (DA) distributed ledger technology (DLT).

At the beginning of the half, ASX announced the finalised Day 1 scope of the platform. This was the culmination of approximately 18 months of industry consultation to identify the new requirements for the replacement system. As part of this process, customers gave ASX feedback that they needed more time to prepare for the new system, so the Exchange adjusted the schedule and now has a target live date of March/April 2021.

Today, the Exchange noted that it is progressing with the build of the system with its partner Digital Asset. At the end of the half, ASX released the first tranche of technical documentation that details the first software to be deployed into the customer development environment, which will be made available in the second half. This will enable customers to begin their preparation activities to integrate their systems to the new platform.

Consultation with customers and stakeholders will be intensive and ongoing. This includes participants, issuers, registry firms and software vendors, and will continue throughout the lifecycle of the project.

ASX has been working since January 2016 with its technology partner Digital Asset to examine and test the ability of a DLT-based system to underpin the replacement of CHESS. This process led to the decision in December 2017 to proceed with a DLT-based solution.

In April 2018, ASX released a consultation paper, CHESS Replacement: New Scope and Implementation Plan. A total of 41 written submissions were received.

The Exchange has noted the strong interest in exploring and understanding different connectivity options. Access to DLT-nodes is being prioritised for existing clearing and settlement participants (and their CHESS accredited vendors). ASX says its priority is to ensure that participants’ connectivity requirements to ASX’s critical infrastructure for the delivery of clearing, settlement and other post-trade services are satisfied in the lead up and transition to the new system. When clearing and settlement participants are sufficiently progressed with their chosen access method (node or non-node) to the new system, ASX will engage with other users who wish to explore the provision of other services by using a DLT-node.

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