Singapore Stock Exchange to Harness Blockchain for Fast Settlements

Singapore’s primary stock exchange has announced its partnership with the country’s central bank to develop a blockchain platform for securities’ settlements.

The Monetary Authority of Singapore (MAS) and Singapore Exchange (SGX) announced on the 24^th of August a collaboration to develop Delivery versus Payment (DvP) capabilities for settlement of tokenised assets across different blockchain platforms. This will allow financial institutions and corporate investors to carry out simultaneous exchange and final settlement of tokenised digital currencies and securities assets, improving operational efficiency and reducing settlement risks.

Three companies, Anquan, Deloitte and Nasdaq have been appointed as technology partners for this project. They will leverage on the open-source software developed and made publicly available in Project Ubin Phase 2. The project will produce a report that examines the potential of automating DvP settlement processes with Smart Contracts and identify key design considerations to ensure resilient operations and enhanced protection for investors. The report will be released by November 2018.

Sopnendu Mohanty, Chief FinTech Officer of MAS, said, “Blockchain technology is radically transforming how financial transactions are performed today, and the ability to transact seamlessly across blockchains will open up a world of new business opportunities. The involvement of three prominent technology partners highlights the commercial interest in making this a reality. We expect to see further growth in this space as FinTechs leverage on the strong pool of talent and expertise in Singapore to develop innovative blockchain applications and benefit from the new opportunities created.”

Tinku Gupta, Head of Technology at SGX, and Project Chair, said, “This initiative will deploy blockchain technology to efficiently link up funds transfer and securities transfer, eliminating both buyers’ and sellers’ risk in the DvP process. This is a collaborative innovation bringing together multiple players to pursue real-world opportunities that will benefit the ecosystem.”