Tel Aviv Stock Exchange (TASE) has launched a blockchain platform that will become a one-stop solution for lending securities.
According to a statement from TASE, the Central Blockchain Securities Lending Platform will create a unified national market in which Israeli businesses can borrow and lend in securities to cover the short-term sale of assets with each other directly.
As noted in the TASE press release, usually the provision of securities is carried out using interbank mechanisms within and outside the limits of banking groups. As a result, the market cannot fully satisfy the potential needs of participants in economic relations.
The new blockchain platform will become a universal solution for all securities lending operations, opening up quick access to large volumes of assets and work with short-term positions.
According to the statement, in March 2020, TASE members received access to a test version of the platform to test the operation of credit transactions and adapt their systems to prepare for the platform’s introduction.
Having distributed ledger technology (DLT) standing at the basis of a new trading platform will allow participants on the market to take advantage of the core benefits and functions of the blockchain. We are talking about P2P transactions, including smart contracts and increased security, which is possible due to the immutability of the blockchain.
As noted by TASE, this will improve the work of custodians and clients of the exchange, as it will reduce fees and other costs, increase safety, and allow the market to reach its potential fully.
Stock exchanges are increasingly turning to blockchain. One of the largest projects in this area is currently being developed by the Australian Stock Exchange (ASX), which wants to launch a clearing and settlement system on the blockchain. Recently, however, it became known that market participants are demanding from ASX systems for two years, because the new project isn’t clear enough.
