ASX wants Aussie fintechs to become blockchain experts
The Australian Securities Exchange (ASX) for the last few years has been working on a project to replace its existing Clearing House Electronic Subregister System (CHESS) platform with another platform based on distributed ledger technology (DLT).
The ASX has grand plans for when the new CHESS system is live and has been touting the platform as one that will allow for a thriving innovation ecosystem.
In its submission to the Select Committee on Financial Technology and Regulatory Technology and its probe into the opportunities the two vectors present to Australia, the ASX touched on the opportunities blockchain, and specifically its CHESS system, will offer fintechs.
“The ASX is building a world-leading distributed ledger infrastructure which will be open for fintechs to build applications on,” the ASX wrote. “To do this, fintechs in Australia will need to develop expertise in blockchain and DLT.”
According to the exchange, one of the ways the government could help reduce the barriers to entry for fintechs is by encouraging learning and development in this space.
“The government can encourage universities, schools, and other training institutions to provide the necessary training for young developers and technologists,” the ASX continued.
“Also, the government could consider helping fintechs fund the substantial investment in training and education required to leverage new technologies by sponsoring courses and educational institutions.”
The exchange also told the committee that another way the government could help fintechs is by “opening the doors” to business opportunities, pointing to an initiative underway in Dubai, the Dubai Blockchain Strategy, which aims to bring together government departments, private companies, and also fintechs.
“Although fintechs are extremely creative and agile, the barriers to entering new markets can be high,” the submission continued. “These barriers range from high fixed costs of entry to challenges building market trust, and brands complying with regulatory red tape.”
In addition to investing in blockchain, the ASX said the government could also do more in encouraging fintechs to continue to invest in research and development. While it said existing incentives do assist, the ASX believes the current process can be cost and time consuming to apply for, and too narrow in scope for fintech businesses combining existing technology with their own.
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