ASX expects delays to CHESS replacement's go-live date - Kalkine Media

March 28, 2022 04:48 PM AEDT | By Aditi Saha
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Highlights

  • The ASX is expected to push back the launch date of its AU$250 million CHESS (clearing house electronic subregister system) clearing and settlement replacement. 
  • The ASX has been designing the world's first industrial-scale blockchain use case, the latest post-trade system to replace its CHESS platform, which has been in operation for almost 25 years.
  • CHESS replacement is a modern and secure replacement that uses global standards to enable new potential and market efficiency. 

The Australian Securities Exchange (ASX), for a fourth time, is expected to push back the launch date of its AU$250 million CHESS (clearing house electronic subregister system) clearing and settlement replacement. 

A delay, whose duration is unknown, is the latest impediment to the roll-out of the new DLT system. DLT stands for distributed ledger technology, a digital method for storing assets transactions in several locations at the same time. 

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What is CHESS?

The ASX Settlement Pty Limited, a wholly-owned ASX subsidiary, operates CHESS. Participants like settlement agents, brokers, institutional investors, custodians are authorised to use ASX Settlement to access CHESS and settle trades executed by themselves or on behalf of their clients.

The settlement of financial products traded on the ASX is managed by CHESS, a world-class computer system.

Moreover, CHESS replacement is a modern and secure replacement that uses global standards to enable new potential and market efficiency.

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How long has the CHESS project been delayed?

The ASX has been designing the world's first industrial-scale blockchain use case, the latest post-trade system to replace its CHESS platform, which has been in operation for almost 25 years.

Furthermore, the system was supposed to be ready for industry-wide testing in July 2020, with a go-live date of April 2021. 

Due to the COVID-19 pandemic, the ASX changed the implementation timeframe for replacing CHESS. To that purpose, it stated at the time that the CHESS platform would be available by April 2022.

Months later, the date was pushed back until April 2023. ASX CEO Dominic Stevens indicated that the organisation was still on track to meet this objective during the firm's 2022 half-year results in February.

However, the ASX revealed on Monday that the April 2023 go-live date is again likely to be pushed back.

Management's statement

In a message to shareholders, ASX group executive Tim Hogben said,

What's next?

The next software update, according to the ASX, is not likely to be tested, received and deployed into its ITE1 (Industry Test Environment 1) until July instead of the end of April.

The next software update will most likely include the next round of non-functional tuning of the application, code updates and a software candidate for providers to accredit against. 

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