The Japan Exchange Group (JPX) will launch testing for a new pilot distributed ledger technology (DLT) platform for sharing securities post-trade information.
Testing of the pilot will commence from April to October under JPX’s ‘Proof of Concept Testing for Utilisation of Blockchain/DLT in Capital Market Infrastructure’ programme.
“Because most of these [post-trade] processes are conducted mutually, it has been pointed out that mismatches in understanding between counterparties about data and workflows can lower efficiency,” JPX stated on its website.
“An information sharing platform using DLT, which excels in synchronising recording and execution of data and workflows, would enable companies to check the latest definitive status of a trade at any time, possibly solving various problems in the post-trade field that companies struggle to solve alone.”
JPX has invited trust banks, asset managers, and other securities services providers to participate in the test.
The test follows the completion of a PoC last year between Daiwa Securities and 26 companies including DTCC Japan, HSBC Securities, Mizuho Securities and Sumitomo Mitsui Trust Bank, among others, for a DLT-based trade matching and post-trade processing platform.
The pilot is the latest blockchain-based innovation to emerge from Japan, which has become a breeding ground for DLT projects.
Last year, Broadridge conducted its first proof of concept (PoC) of a blockchain-based proxy vote platform in Japan. The solution was developed specifically for the Japanese proxy marker by ICJ, a joint venture of Broadridge and the Tokyo Stock Exchange, using Quorum as the underlying DLT.