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ASX conflicts of interest point to utility model to settle equities


The collapse of the CHESS replacement project has raised questions about ASX’s capability to manage post-trade functions in the $2.5trn equity market.

James Eyers Senior Reporter

Dec 5, 2022 – 5.00am

The Australian Securities Exchange’s overly ambitious upgrade of the CHESS system that settles trades in the $2.5 trillion equity market is in tatters. Now, questions are flying about whether it is capable of managing critical national economic infrastructure.

Following a humiliating, $250 million writedown last month after a seven-year struggle to deploy experimental blockchain technology to update CHESS, the ASX faces accusations it failed to manage conflicts of interest when it designed the upgrade.

At a hearing of the powerful parliamentary joint committee on corporations and financial services on Monday, policymakers are set to pry into Australia’s vertically integrated market structure.

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