National Stock Exchange of Australia (NSXA), a Sydney-based stock exchange owned and operated by NSX Limited, is joining forces with iSignthis (ISX), to develop a blockchain-based digital securities platform that would rival that of the Australian Securities Exchange (ASX).
To that effect, the Australian company has hinted that it’s looking to offer its blockchain network to third parties for the development and hosting of applications, upon the platform’s completion.
Richard has also revealed that there are 31 entities working towards the development of the platform, however, these participants are not a part of the testing phase of the project since its launch has been scheduled for mid next year.
In addition, he remarked that even if the ASX’s blockchain push fails to yield the desired results, the company will be unaffected.
NSXA Joins the Blockchain Movement
Per sources close to the matter, the National Stock Exchange of Australia has formed a joint venture with iSignthis, a publicly listed firm, in a bid to develop a blockchain-based settlement system dubbed ClearPay.
The NSXA is teaming with iSignthis to build ClearPay, which will compete directly with the ASX-owned Austraclear facility.
ISignthis has taken a 12.96% initial position in the NSX Ltd and 59% of the new joint venture vehicle, ClearPay Pty Ltd, with the aim of creating “an open, transparent, modern and high-tech focussed alternative to the ASX”.
The NSXA will offer digital asset trading in real time, with multi-currency facilities, based upon digital ledger technology (DLT). Fractional trading will become a possibility, as will real time settlements.
The ASX in July will begin testing of its own blockchain-based alternative to legacy settlement service Chess, a major project to achieve same-day settlement using distributed ledger technology from Digital Asset.
ISingthis is proving to be a thorn in the side of ASX, filing a lawsuit in December over the suspension of its shares.
Reportedly, as part of the agreement, iSignthis has pumped in $4.2 million in NSX via a private placement, giving it a 12.96 percent stake in NSXA and 59 percent in ClearPay Pty Ltd.
The team expects ClearPay to function as an open, highly transparent, modern and high-tech focused alternative to the ASX, enabling the NSXA to facilitate real-time digital assets trading, with multi-currency support powered by blockchain technology.
Blockchain Taking Over
If all goes as planned, the ClearPay platform will go live in early 2021, and the domestic and international broker network will connect to it through the ISO20022 electronic data interchange standard.
The team says ClearPay will be accessible to interested market participants as well as share registry operators, and the National Stock Exchange of Australia (NSXA) will function as the central authority.
Commenting on the ClearPay project, ISignthis reiterated that the successful launch of the platform will promote healthy competition between the firm and the ASX.
“ISignthis will be in competition with the ASX across multiple fronts, and we are looking forward to taking up the challenge.”
The firm added:
“We believe that by bringing competition to the market, and by providing a truly modern, open and transparent exchange, that we will bring substantial benefits to the Australian public, allow businesses access to fresh equity, whilst providing an alternative for the cash equity market.“
The Australian Securities Exchange, Digital Asset, and VMware, a cloud infrastructure provider announced plans to develop a blockchain solution to replace the existing Clearing House Electronic Sub register System (CHESS).
Though the ASX blockchain ambition has faced several criticisms from other market participants including the Chi-X, the new DLT-based settlement platform will enter its testing phase later in July 2020.