ASX, which operates the Australian Securities Exchange, has signed a memorandum of understanding (MoU) with Digital Asset and VMware to work together on initiatives based around blockchain-style distributed ledger technology (DLT).
ASX said that Digital Asset and VMware would support its plan to offer support for DLT implementations in the Australian and New Zealand markets.
ASX is currently in the middle of one of the most prominent efforts to put blockchain-inspired technology into production, outside of cryptocurrencies. The exchange operator is building out a replacement for its CHESS system. The COBOL-based CHESS delivers clearing, settlement, and asset registration services, and has been in operation since 1994.
ASX says that the DLT-based replacement for the system will offer a number of advantages for market participants, but will also allow it and other companies to build new services that interact system via Digital Asset Modeling Language (DAML): An open source ‘smart contract’ language designed by Digital Asset.
The new ASX-operated system is expected to go live in 2021. In April, ASX revealed it had launched a development environment for the CHESS replacement.
ASX in 2016 acquired a 5 per cent stake in the US-based Digital Asset as part of its move to implement a DLT-based replacement for CHESS.
ASX said that the three-party MoU covers development the new system, supporting DAML, and the “provision and support of the distributed ledger and associated infrastructure, which delivers ASX’s data privacy, confidentiality and security requirements at greater scale”.
Beyond replacing CHESS, however, the MoU will lay the basis for working together to provide and support DLT for other customers in the A/NZ markets.
ASX has established a “DLT Solutions” team as part of its efforts to capitalise on its experience of implementing an enterprise-grade DLT system.
“This new partnership is a very positive development that will help us support a wider range of DLT solutions developed by the industry,” said ASX deputy CEO Peter Hiom. “It confirms our belief in the potential of DLT as we remain on track to deliver the CHESS replacement system in March-April 2021.”
“We continue to achieve our milestones to deliver a production-grade, scalable distributed ledger solution for CHESS,” said Yuval Rooz, the co-founder and CEO of Digital Asset.
“VMware is now part of the mission we share with ASX to deliver a DAML-based distributed infrastructure to realise the full potential of this technology.”
VMware’s chief research officer David Tennenhouse said the virtualization heavyweight was “working closely with DA and ASX on a combined offering to provide the enterprise-grade foundation for ASX, and we look forward to expanding our relationship”.