The tel Aviv stock exchange (TASE) has launched a blockchain platform that will become a universal solution for providing securities on credit.
According to the application
TASE, the Central Blockchain Securities Lending Platform will provide a single national market where Israeli businesses will be able to borrow and lend securities to cover short-term asset sales with each other directly.
As noted in THE TASE press release, securities are usually lent using interbank mechanisms within and outside the limits of banking groups. As a result, the market cannot fully meet the potential needs of participants in economic relations.
The new blockchain-based platform will become a universal solution for all securities lending operations, providing quick access to large volumes of assets and working with short-term positions.
According to the statement, in March 2020, TASE members were granted access to a test version of the platform to test the operation of credit transactions and adapt their systems to prepare for the implementation of the platform.
Using distributed Ledger technology (DLT) as the basis for a new trading platform will allow market participants to take advantage of the main advantages and functions of the blockchain. In particular, we are talking about P2P transactions, smart contracts and increased security, which is possible due to the immutability of the blockchain.
According to TASE, this will improve the work of custodians and exchange clients, as it will reduce costs, increase security and allow the market to fully realize its potential.
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 blockchain-based clearing and settlement system. However, it has recently become known that market participants require
from the ASX system for two years, as the new project “lacks clarity”.