Clear Understanding

Historic move provides global opportunity for private markets

• ASIC and RBA have granted groundbreaking licencing to FCX to trade and settle shares in private companies and units in managed investment schemes
• ASIC has taken a step in promoting competition in clearing and settlement of securities for the first time
• The move takes Australia from a financial centre laggard^[1] to global leader as the first country to boast a fully regulated, ledger-enabled marketplace (outside limited sandbox environments)

Sydney, 8 October 2024 – FCX, Australia’s first platform for facilitating private market secondary transactions and a subsidiary of FinClear, has been awarded the first-of-its-kind Australian Market Licence and Clearing and Settlement Facility Licence by the Australian Securities and Investments Commission (ASIC) and the Reserve Bank of Australia (RBA), in respect of the trading and clearing and settlement of the FCX Market, making it the first fully-regulated platform for facilitating private market secondary transactions.

The licences enable the FCX Market to trade securities in private and unlisted public companies and interests in managed investment schemes, creating the world’s only distributed ledger-enabled, fully regulated private market.

Commenting on the Licences, David Ferrall, Founder and CEO of FinClear Group, said:

“We are delighted to have been granted Australian Market and Clearing & Settlement Licences and would like to thank ASIC and the RBA for their incredible support in making this happen. This is a pivotal moment not only for Australia’s private companies and capital markets but for financial markets globally.

“The Licenses set a new global standard for regulated private capital markets and are a significant step forwards for Australia’s financial infrastructure.

“FCX provides a ‘bridge’ from private to public delivering a fully regulated ecosystem for companies to utilise.”

ASIC has promoted competition

The Australian Market Licence makes FCX the first and only Tier 2 market operator for securities in Australia; while the Australian Clearing and Settlement Facility Licence makes FCX the first and only fully licenced alternative to ASX Clear and ASX CHESS in Australia. Together, these licences position FCX as the only operator other than the ASX to have complete market and clearing and settlement capabilities.

Following commitments from ASIC to promote competition and innovation of clearing and settlement services in the Australian market, this licence constitutes the first instance of allowing competitors to offer clearing and settlement services after the Treasurer legislated ASIC to do so late last year.

Establishing a regulatory solution for private secondary transactions

Demand from Australia’s largest private companies and their investors for a regulated and trusted market has never been greater. With over 50 companies already using FCX for better capital governance – cap table services, ESOP administration, capital raising and corporate action support – appetite for trusted and efficient liquidity solutions is high.

FCX Market comprises, for the first time globally, an integrated and regulated ecosystem which offers liquidity on demand, rather than daily liquidity, and is able to take companies from early to mid stage and onto a mature public listing. The FCX Market will give companies the ability to provide controlled liquidity solutions to shareholders and employees. For investors, it will provide liquidity, transparency, and security lacking in private assets until now – as well as direct access to an asset class historically out of reach for non-institutional investors.

The market will not operate continuously but will have liquidity events, as set by companies and managed investment schemes, with disclosure and operating rules governing the operation of market events.

FCX is currently working with ASIC to fulfil conditions of the licenses prior to operating the full market capabilities.

Cutting-edge tech for smarter automation

The FCX Market is built on Distributed Ledger Technology (DLT), recognised as the new standard in financial markets infrastructure, to conduct transactions with full digital automation for better transparency, accuracy and security, and significantly reduced settlement burdens.

DLT allows for more efficient and frictionless exchanges, without the need for multiple intermediaries – thereby realising efficiencies and reducing costs – while enabling more complex information and actions to be included in transactions, for example via ‘smart contracts’.

Global first

With Australia falling from being at the forefront of global financial market capabilities in the early 2000s, to outdated technology in recent years, especially in clearing and settlement, this development puts Australia ahead of all other countries and regions with the world’s first regulated market of its kind.^[2]

Representing not only an Australian first but the first securities market globally to operate within regulatory ‘rails’ and offer atomic (i.e. instant) settlement capabilities underpinned by DLT, FCX opens the door to a global private market – allowing for connection between the US$13.1tn^[3] private markets globally, thanks to the interoperability of the underlying DLT.

While other countries and regions have been experimenting with such technologies for longer, these primarily exist in restricted ‘sandbox’ environments subject to pressures from market forces, especially custodial intermediaries set to lose an expensive stranglehold over exchanges. The technology also offers a sophisticated T+0 solution for listed market issues, resembling what the CHESS replacement could be, and proving a resilient and scalable design.

Private markets soar

With public markets shrinking and concentrating in Australia and globally, while private markets surge, the need for regulated opportunities in the latter has never been higher. IPOs

on the ASX have hit their lowest ebb since the GFC and private capital has emerged as the fastest-growing asset sector.^[4]

FCX meets the increasingly corporate and complex needs of private companies who wish to remain private, and investor desire for direct access to regulated private market opportunities that far exceed the $2.7tn securities on ASX.^[5]

Yuval Rooz, Co-Founder and CEO, Digital Asset said:

“Private markets are a growing and increasingly important part of the global economy and are projected to reach more than USD 18 trillion by 2027.^[6] They present tremendous opportunities for investors globally, but they have been underserved by legacy technologies. We’re excited to partner with FCX to support the digitisation of private markets on the Canton Network.

Traditionally, private markets have been constrained by manual processes and significant friction, but the exponential potential for these assets makes them a perfect use case for distributed ledger technology. This will ultimately increase the availability of capital through greater access for investors, increase transaction flow and liquidity, and ultimately unlock trapped economic growth.”

____________________ 

About the Terms of Licence:

An Australian CS Facility Licence and an Australian Market Licence are granted to FinClear Pty Ltd under subsection 824B(1) and section 795B of the Corporations Act 2001 and authorise the Licensee to operate a facility that effects the settlement of FCX market transactions, and operate the Market, for

• shares in a company; and
• interests in a managed investment scheme that is structured as a unit trust;

other than shares or interest that are able to be traded on a licenced market other than the FCX market.

The Licensee must not allow a person to participate in the Facility unless the person is a participant in the FCX market, and:

• the person is a wholesale participant that only deals in the FCX market on their own behalf; or
• the person is a retail participant that only deals on the FCX market on their own behalf and only participates in the FCX market to dispose of their financial products through the FCX market, but does not acquire any financial products through the FCX market.

See ASIC Gazette for full terms >

______________________

^[1] From Laggard to Leader: Why the capabilities that power Australia’s Clearing & Settlement services are falling behind global leaders, and how we can get back to the front of the pack, Mandala Group

^[2] “While global peers are moving to adopt newer technologies, Australia’s singular reliance on CHESS means it is currently constrained in its capacity to integrate emerging technologies into post-trade processes…[There is] opportunity for Australia to return to the global frontier by enabling the adoption of more innovative and efficient technologies, including distributed ledger technologies (DLT), in Clearing and Settlement services.

… Government and industry must work together to design a modernised regulatory framework that delivers reliable, stable, efficient and secure financial markets…allowing Australia to reclaim its former position at the global frontier of financial markets infrastructure.

There are three key phases to returning Australia to the global frontier of financial markets:

• Grant regulatory relief for new entrants in C&S markets.
• Enable interoperability amongst C&S systems.
• Evolve the market structure to ensure responsible competition in C&S markets.” From Laggard to Leader, Mandala Group

^[3] McKinsey Global Private Markets Review 2024: Private markets in a slower era

^[4] The death of IPOs is just the start. The whole world’s going private, AFR 4 Oct 2024

^[5] “The value of unlisted equity has consistently exceeded that of listed equity.” Trends in Australian capital markets, Business Council of Australia, Oct 2019

“Australia ASX Market Capitalization: Domestic data was reported at 2,655,838.000 AUD mn in Apr 2024.” CEIC data, Australia ASX Market Capitalization: Domestic

^[6] Private Markets – A Growing, Alternative Asset Class, S&P Global

THE CLIENT

The value-driven fintech brokerage, moomoo, with over 22 million users worldwide, has partnered with FinClear to offer Australians the trusted Individual Holder Identification Number (HIN) trading on the Australian Securities Exchange (ASX).

The collaboration between moomoo and FinClear will enhance options and security and underscores their commitment to empowering Australian investors, who have access to cutting-edge solutions in the ever-evolving world of online trading.

THE BRIEF

Moomoo currently offers Australian investors ASX trading via a custodial solution, but will now provide investors with the additional option of trading ‘CHESS-sponsored’ shares. This means investors can directly own their shares via their HIN.

There are two options for retail investors to trade shares in Australia – a custodial or ‘omnibus’ solution, where investors’ shares are held in a single account by a custodian, or an individual CHESS-sponsored HIN solution.

Many Australians prefer the latter as they feel it gives them greater security over their holdings.

“Some investors want the enhanced transparency, control and security they feel direct ownership provides – and they were asking us for it,” moomoo Chief Executive Officer Toby Wong said.

“But others still prefer a custodial solution, so we needed to offer both to meet inbound demand without inconveniencing existing clients that wanted to keep the status quo and avoid the administrative burdens.

“We chose FinClear as our strategic partner for its reputation and flexibility. Their solutions are tried and tested by the market and they have an exemplary track record.”

THE ADVANTAGE FOR MOOMOO USERS

In addition to HIN trading, moomoo opted to use global messaging standard FIX (Financial Information eXchange protocol) connectivity, an API broking solution offered by FinClear for real-time and on-demand post-trade processing and data extraction.

The efficiencies of FinClear’s service solutions mean moomoo will be able to keep costs low for its users – for example, automating account openings to reduce manual administration burdens.

For moomoo’s existing clients that wanted to migrate to individual HIN/CHESS-sponsored trading, FinClear helped transfer assets from the custodial solution to its platform.

“FinClear made launching this option for Australian investors smooth and successful, working cross-border with our global teams to guide us through the nuances of domestic infrastructure and demand,” Mr Wong said.

“We are proud to have brought this solution to the Australian market, and were able to do so with FinClear’s exceptional support.”

MORE ABOUT MOOMOO

Moomoo provides investors with an intuitive and powerful online share-trading platform for investing in ASX, US, Canada, Japan, Hong Kong, Singapore and Malaysia sharemarkets. Moomoo continues to expand its offering, most recently launching in Malaysia and collaborating with Nasdaq via a Global Strategic Partnership.

Its Australian offering includes access to all securities listed on the ASX and Cboe and extends to more than 22,000 shares and ETFs across Australia, US and Hong Kong markets, along with competitive trading fees and a suite of professional-level features and tools.

The platform also offers AI-powered capabilities, access to global news, and free investment courses. In a market-first last June, moomoo introduced access to 24-hour trading of US stocks and ETFs for Australian investors.

Moomoo launched its Australian HIN offering on April 8, 2024 and since then has been providing Australian investors direct access to own and trade shares on the ASX and Cboe with minimal fees. That service offering is the result of a strategic partnership with FinClear.

Sydney, 14 May, 2024 – FinClear, Australia’s leading independent technology and infrastructure provider for financial market access, today announced it will be extending its collaboration with Ord Minnett, one of Australia’s leading advice and investment services firms, to include wholesale foreign exchange and international payment services, complementing its existing execution and clearing services.

FinClear’s additional services will be critical to facilitate trading activities with Canada and the US, both of which move to a T+1 settlement cycle on 27 May & 28 May respectively. This compression in settlement times necessitates efficient foreign exchange solutions to ensure seamless, uninterrupted trading and financial transactions.

At a time when Australian investors are increasingly seeking international diversification, driven by a combination of a shrinking ASX and burgeoning US markets, which now account for 60.5% of total global equity market size, in Canada accounting for 2.5% of total global markets, these additional services will be crucial for Ord Minnett to meet these new global requirements.

Commenting on the extended partnership, David Ferrall, Founder and CEO of FinClear Group, said:

“We are delighted to extend our partnership with Ord Minnett as part of our drive to deliver efficiencies for wealth participants across both domestic and international securities and now also foreign exchange markets.

“FinClear’s position as Australia’s leading financial market access provider allows us to offer a full suite of services supporting our core clearing and settlement proposition. This partnership demonstrates our commitment to ensure our clients remain ahead of changing global market dynamics and can continue supporting their customers regardless.”

Karl Morris, CEO & Managing Director of Ord Minnett, commented on the partnership, saying, “Ord Minnett is pleased to offer clients competitive FX rates with same day international payment capability through our partnership with FinClear. This means our advisers and their clients can trade global markets with confidence their transactions will be settled on-time. FinClear’s approach to reducing settlement cycles and associated risks through its core clearing capability is a plus for our business.”

The partnership with FinClear provides Ord Minnett with the benefit of a range of comprehensive services that underscores FinClear’s commitment to delivering unparalleled value to its partners and clients.

Last week the bipartisan ‘Standing Committee on Economics’ released the ‘Better Competition, Better Prices Report‘ the result of an inquiry into competition and economic dynamism in the Australian ecosystem. It highlighted that competition holds prices down and service quality up, and has a symbiotic relationship with economic dynamism. Together they “drive innovation and long-term productivity growth”.

The report covers a wide range of areas, from mortgage loans to airports. But our particular interest and expertise is on interoperability and competition in financial market technology. FinClear is quoted in these sections of the report, having appeared before the Committee last year to contribute to hearings on the same.

The FinClear Group told the Committee that there was clear evidence that moving from a monopolistic arrangement in settlement and clearing services to a competitive market would lead to more efficient technology capability and lower pricing. The FinClear Group added that ‘it’s important that when you look at this you look at promoting competition in a proportionate way that doesn’t put the financial infrastructure at risk’.

We are very proud to have contributed to this report and to the ongoing industry dialogue.

A push for greater competition

One of the reports key findings states – The committee supports efforts to increase innovation in financial services, reduce unnecessary delays in approval times for new market entrants, and reduce monopolistic regulatory arrangements.

Why is this important?

Due to the failure of ASX to replace CHESS in a timely fashion (see our previous articles for the full story), Australian financial services and its customers remain at its mercy for another extended timeframe and unspecified technology solution. But since the ASX is the only provider of equities clearing in Australia, we also remain at risk of falling behind global markets – resulting in turn in more capital outflows to other (more competitive and progressive) global markets.  This is already playing out with two of our most successful homegrown technology companies – Atlassian and Canva – electing to list offshore. (more…)

This groundbreaking one-day conference being held on May 8 in Sydney will navigate the intricate landscape of domestic and global economic affairs and will set the stage for transformative change in wealth management.

Delegates will gain a profound understanding of the economic dynamics shaping the wealth management landscape and will provide an opportunity to explore the forces driving change in both domestic and global financial markets.

If you are attending the conference, be sure to pop by and say hi to the team and be sure to check out our morning keynote session with Dan Bower and Bill Keogh.

The art of cash management: Why banks don’t always want your money

Cash Management is not always what it seems. Banks want your money so they can lend it out, don’t they? Well yes, kind of but not always…they want it at their price not yours. Let us take you through the refined art of cash and money management and what banks really care about. More importantly let’s talk about how you can get the banks to work for you, not the other way around.

In this session Bill and Dan will discuss:

• Term deposit accounts – what they actually are, how they differ, and why you need to look more broadly
• When is an offered rate a real rate and when is it simply clickbait? We put a spotlight on the labyrinth of money management
• Australia and US rate changes mean you can currently get better cash rates overseas, we take a look at strategies to help you access cash around the globe in real time.

Click here for more information on the conference and to register.

Navigating the challenges of global markets moving to T+1: How a strategic approach can help market participants

The imminent shift in settlement cycles by major North American markets from T+2 to T+1, scheduled for 28 May this year, is causing widespread concerns among Australian brokers and market participants.

The move to T1 is underway with hopes this change will increase efficiencies, reduce counterparty risk, optimise lower margin costs, deploy capital more effectively, enhance system security, as well as increasing liquidity and volumes. But with cash and equities exchanging poised to settle a single day after a trade is made this will push North American markets one full day ahead of Australia, which will remain on the old T+2 system.

As the world’s financial landscape evolves, the misalignment between Australian and North American markets presents operational challenges and potential financial risks at a time when investors are increasing their exposure to global equities.

The move to T+1 settlement in the US and Canada introduces operational complexities for Australian brokers, wealth managers, and other market participants. The shortened settlement cycle leaves less time for error detection and correction. For firms lacking the necessary resources to process settlements in shortened timeframes, or for those that rely on manual processes and overnight batch processing, the move to T+1 could lead to an increase in the late settlement rate. The industry is already experiencing a 5% failure rate in settlement, costing billions of dollars. This figure will likely rise with the impending change.

One of the critical concerns is the impact on security deposits and risk management strategies. Currently, Australian brokers often use proceeds from local settlements to trade into the US and Canada. With the shift to T+1, this could result in brokers needing larger security deposits, affecting their ability to deploy capital elsewhere. This may lead to consolidation in the market, as smaller players find it challenging to meet increased collateral requirements.

And the financial repercussions extend beyond security deposits, with rising costs of capital and other fees expected to be passed on to customers. As a result, more traders may opt to access markets directly, bypassing traditional custodians and wealth platforms. This shift could prompt financial planners to explore alternative trading platforms or broker dealers to access US markets, driven by cost considerations and the complexity introduced by the T+1 settlement change.

Regulatory considerations weigh heavily

The transition to T+1 settlement also raises regulatory considerations, necessitating changes to comply with new rules and regulations. Brokers will need to navigate potential regulatory hurdles to ensure a smooth transition to the accelerated settlement cycle.

We are actively advising our own clients on the implications of the T+1 shift and introducing new services to help them mitigate risks. To address the operational challenges, brokers and managers will need to settle faster and more efficiently than in the past. This involves having cash and stock readily accessible on the platform and leveraging technology, such as real-time international payments, using the NPP, and deposits – linked multi-currency accounts or wallets – to avoid the need to leave cash on account in the North American markets all the time.

FinClear’s new products and services are specifically designed to address the challenges posed by T+1 settlement. This includes an internal FX desk for near-real-time international payments, routes into global markets for smaller brokers, and an integrated TradeCentre platform for real-time order placement and monitoring.

Relationships are key to navigate the T+1 global landscape. For us this has meant leveraging our extensive global relationships with leading US broker-dealers and global custodians to provide market participants with a single point of contact. This strategic approach streamlines processes and minimises touchpoints, offering a scalable solution for accessing T+1 markets.

The question of when or if Australia will realign its settlement cycle to match Wall Street remains unanswered. The ASX, actively consulting on the issue, has formed a working group involving key industry stakeholders to explore the impact and potential benefits of a shorter settlement cycle. While Australia faces challenges, including a delayed CHESS replacement program, we are confident in Australia’s capabilities to adapt and align with global standards.

As global markets transition to T+1 settlement, Australian market participants must proactively address the challenges posed by the misalignment with North American markets. Our own strategic approach involves focusing on advising clients, introducing innovative technological solutions, and utilising our extensive global relationships to navigate the complexities of the evolving financial landscape.

While uncertainties remain, the financial industry’s ability to adapt and embrace change will determine its resilience in the face of evolving global market dynamics.

This article from Andrea Marani, CEO Execution & Clearing for FinClear made the cover of this month’s Stockbrokers and Investment Advisers Association March Monthly. Read the March edition here.

The FinClear Group are proud to be supporting this year’s Family Business Conference in Cairns. In its 24th year, the conference serves as a platform to empower family business leaders with the insights they need to make informed decisions about the future. Topics covered during this three-day event include:

• Effective conversations and communications
• The strategic transfer of ownership to non-family employees or managers
• The pivotal role of family businesses in achieving sustainable development goals
• Strategies for preparing for external investors
• Gaining a deeper understanding of generational differences
• The significance of board and governance, with an emphasis on appointing fellow family business owners as directors to guide decision-making.

The FinClear Group – made up of FinClear, FCX and Transact1, provide services to hundreds of wholesale clients including equity trading, cash management, FX, and private markets. We are trusted by over half a million Australians to host over $150bn of their assets. Our client base extends from Australia’ biggest retail stockbroker to family-owned wealth advisers in rural Australia.

We are looking forward to being a part of this conference and meeting with the wonderful family businesses attending.

More about the conference here.

The landscape of wealth advisory and broking in Australia is poised for significant transformation in 2024, as various trends shape the industry’s future. From AI advancements to digitisation of broking, here are five major trends set to impact the industry.

1. The rise of generative AI

Brokers and advisors are keeping an interested eye on what the rise of generative AI such as ChatGPT means for client behaviours and financial advice. Is ChatGPT’s ability to generate personalised financial advice a challenge to their role – and if it isn’t yet, is that day coming? How will it change client expectations, interactions and investment engagement models?

While AI can provide some insights, it doesn’t replace the value of relationships and personalised advice. Brokers and advisers will need to find a balance between leveraging AI for efficiency and maintaining meaningful client connections. In this environment, personal relationships and the human value-add matter more than ever.

2. Accelerating intergenerational transfer of wealth

This has been on brokers’ minds in recent years, but it continues to grow in relevance as the wealthiest generation – Baby Boomers – pass their wealth to Gen X and Millennials.

Our research (read our full report “What did High Net Worth Investors Do With Their Money in FY23?”) shows that, while high net worth investors over 70 have higher average portfolio values, those under 70 are on track to become even wealthier. Amongst our data set, over 70s (average age 78) HNWIs hold a median portfolio of $2.14mn in assets on platform – accumulated over a lifetime, although one without the benefit of the superannuation guarantee scheme. But HNWIs under 70 (average age 52) hold a median portfolio value of $1.34mn. Much of this is likely SMSF assets, since more than half of this group would have benefited from the superannuation guarantee.

This shows that, whilst baby boomers have been the wealthiest generation until now, Australian Gen-X are set to be even wealthier, with significant inheritance of baby boomer wealth adding to their own wealth accumulated through property and superannuation over the longest period of economic growth.

And we know that Gen X and millennials invest differently – with different priorities, guiding principles, and touchpoints. Brokers and advisers are considering how best to adapt their approach and offering for these upcoming cohorts. These demographics typically expect a more digital experience and are more likely to ‘self-serve’. For example, Superhero has announced plans to launch an adviser platform in H1 2024 to ‘meet the needs of its maturing Millennial retail investor base’.

Here too, strong client relationships will matter, especially as these clients are more hands-on tools. In a bid to reach into new markets of self-service younger investors, some brokers may choose to leverage APIs to build a retail offering, like Stake, Superhero and Webull. These will attract digitally-minded retail investors who can then be offered added-value through advisory services. We also see an increasing trend of brokers give clients ‘view-only’ access to their accounts on FinClear, enabled through our TradeCentre Adviser platform, to meet changing client expectations. The future of broking will adopt such hybrid models, which combine digital self-service tools with personalised advice.

3. Digitisation and seeking out efficiencies

Open APIs are becoming integral across the industry, with their benefit as a way of integrating systems that avoids moving data files and helps drives efficiencies.

The digitisation of wealth continues, whether moving from wet signatures to e-signatures, or creating bridges between different infrastructure components.

With the shortening of the settlement cycle to T+1 settlement in the US from May 2024, and other markets considering the same, smarter technological solutions are needed to manage the misalignment in settlement times and manage collateral requirements.

The power of open APIs is part of the larger trend of streamlining operations. As the cost of business continues to rise, the industry continues to look at more automated and more affordable options. This year FinClear brought version 8 of our TradeCentre Adviser online, fully interoperable with ASX, Cboe, and Iress. We increasingly see brokers migrate to TC Advisor, not just for its powerful capabilities, but also for the significant cost savings – trimming budgets by almost half across hundreds of screens.

4. Keeping up with regulation

Players large and small are also considering how digitisation can help to streamline their regulatory burden. Sophisticated RegTech solutions can be leveraged to lower transaction costs, empowering brokers and advisors to do more.

Many are reviewing where they can outsource AML/KYC checks and PEP screening, and leverage providers of clearing and settlement for leaner internal operations. Given its position, FinClear is often approached to support as it is well-placed to understand and apply the right technology to help brokers operate more efficiently.

5. Demand for international markets

Finally, we will see the demand for direct access to international markets continue to grow in the new year, with a flood to cash and yield products. Driven by a shrinking market, investors want to tap into strong performing companies in larger markets such as the US. The access to sectors such as tech stocks remains limited in Australia, and brokers find clients keen to swim in bigger ponds, with a particular focus on Silicon Valley and big banks, to diversify their portfolios.

Dynamic change needs a dynamic approach

In all, we expect 2024 to see major evolution in wealth management, with brokers and advisors at the forefront of technological, regulatory, and client change. Finding the best way to navigate these shifts – with the support of partners such as FinClear – will keep brokers comfortably ahead of the pack.

This two-day annual conference being held on May 14 & 15 in Melbourne, brings together those who work in capital markets and private wealth management, providing valuable professional development opportunities.

The forum is designed to explore the future of the industry amidst rapidly changing demographics, regulations, technology and industry-wide initiatives that will help shape the evolution of Australia’s equity markets.

If you are attending the conference, be sure to pop by and say hi to the team and be sure to check out the first plenary session on day two featuring our own David Ferrall.

Market structure evolution: What next and is Australia ready?

With T+1 being implemented in the US and other markets, and post trade innovation occurring in various markets, is Australia at risk of being left behind? CHESS replacement is still some time in the future. There is great uncertainty as to what this means for T+1 implementation in this market. Is the innovation that is taking place elsewhere putting Australia at risk if our market treads water?

Panel:

• David Ferrall, CEO & Managing Director, FinClear
• Paul Conn, President, Computershare Global Capital Markets
• Mark Wootton, Client Line Co-Head, Financial Intermediaries & Corporates, Asia-Pacific, BNP Paribas
• Moderator: Clive Triance, Group Executive, Securities & Payments, ASX

Click here for more information on the conference and to register.

As Australia’s financial landscape evolves, FinClear’s extensive suite of products and services, fronted by our Third-Party Clearing (TPC) capabilities, is playing an increasingly critical role in maintaining the liquidity, efficiency, and transparency of our local markets. This article delves into what’s been driving the demand for TPC services and why FinClear’s significant investments in technology, coupled with its capacity and domestic market expertise make FinClear the ideal partner for any financial organisation looking to meet the demands of today’s complex market requirements.

TPC at its core is a utility business that underpins the daily workings of financial markets in Australia, with its primary focus being the provision of a resilient, scalable, and reliable service offering. Before getting into what sets FinClear’s TPC offering part from anyone else in the market, let’s take a closer look at how clearing and settlement is evolving and the impact on Market Participants.

Clearing & settlement explained

There are considerable workings involved in post-trade activities like Clearing and Settlement.

Clearing, which occurs right after a trade, determines what participants owe and are owed upon settlement.

Settlement is a two-way process which involves both the transfer of funds and securities to the ultimate beneficiary on the settlement date, which in Australia is two days after trade date (T2). Trades executed on the local markets are submitted to ASX Clear for registration, and once accepted by ASX Clear, by way of novation, each cash market trade is replaced with a netted cash market transaction between each Clearing Participant and ASX Clear. Settlement is then conducted through the Clearing House Electronic Sub-Register System (CHESS). CHESS is globally unique in combining settlement services with an electronic sub-register, used to record ownership of shares bought and sold (this is where the much-loved HIN comes into play) by clients of Market Participants.

In other markets such as the US, individual books and records are held by each clearing broker in custody rather than in the end clients’ own name.

Diagram showing the Clearing & Settlement process. Source: ASX 

Third Party Clearing

Building on this explanation, TPC is when the Clearing and Settlement functions are performed by an external Clearing Participant for an independent (Third-Party) Market Participant rather than directly by the Market Participant themselves.

Outsourcing Clearing and Settlement to a Third-Party Clearing Participant (CP) might sound simple but the devil is in the detail. The CP not only takes on the operational responsibilities but also the regulatory requirements and responsibilities. Most importantly, the CP takes on the credit exposure of its clients, and their end clients, over the T2 settlement period. The CP is legally obliged to settle all trades novated to it regardless of whether cash or stock is received from the Market Participant. As such CPs are subject to stringent capital and liquidity requirements to undertake their role.

The combination of significant capital requirements and to the need to meet onerous legal and regulatory requirements is why Market Participants choose to outsource the process to TPC service providers such as FinClear.

Looking under the hood of a TPC business

A successful TPC business needs expertise, substantial capital ($20m+ only gets you in the door), significant capability, experience and know how to comply with the stringent regulatory requirements. It also needs solid technical capabilities and because it’s a low margin business with high capital requirements, to make this all worthwhile it needs scale. Lots of scale.

You can have the biggest balance sheet and the largest tech team out there but without business scale for this particular offering, this all just translates into financial cost and losses.

“Australian Made” is also a big factor in longevity.  Over the eight years FinClear has been operating, numerous global players have entered the market; failed to get traction over a number of years, and ultimately exited. The overseas parent is then wondering what went wrong and any customers they might have picked up along the way are left high and dry.

There is no such thing as overnight success

Make no mistake, establishing a TPC business takes a significant amount of time. FinClear has been focused on third party clearing for over eight years, with the acquisition of the Pershing business in 2021 putting FinClear on the map, accelerating its growth and giving it the scale to become the leading TPC provider in the Australian market.

How FinClear’s tech strategy has evolved

For a tech-based utility provider like FinClear, having a robust technology framework to serve our clients’ needs and the multiple disciplines of its own business is of primary importance.  FinClear prides itself in the strength of its tech stack and the extensive range of services it provides Market Participants and AFSL holders.

In today’s ever-changing markets, our technology strategy continues to evolve. Back in the early 2000’s the industry was vendor centric via self-clearing models and back-office systems were very ‘siloed’ in operation. At that time, FinClear took the view that offering a comprehensive clearing service had to be complemented by an in-house technology capability and was an early adopter for consolidation of technology systems and services through the acquisition of DION and iBROKER. FinClear also took the view that while the back-office connectivity was important, putting clients into clunky back-office systems was not the way forward and a better strategy was to invest in client friendly modern middleware, hence the decision to develop Trade Centre (TC) applications.

When the ASX CHESS replacement project was announced in 2015, FinClear intended to leverage ASX’s bold plans into a new technology stack which would ultimately replace iBROKER. FinClear’s acquisition of Pershing in 2021 provided the platform to quickly gain the critical scale required.

With the subsequent unravelling of ASX’s CHESS replacement project and recent updates confirming a diminished scope and prolonged timeline, FinClear will continue to maintain a link into ASX CHESS (which is not going to change substantially for years to come) by further developing its partnership with Broadridge. FinClear will consolidate its back-office activities into one system, being Summit) as well as continuing to invest in its TC platform. For clients who want more than a stand-alone utility TPC offering, FinClear’s additional services can provide important benefits and real advantages.

Additional products and services

Leveraging our position as the leading provider of TPC services in Australia, FinClear acts as an aggregator of services from the market and channels these through to our clients on better terms. This applies to services such as international trading, access to Fixed Income and other asset classes. We are currently running advanced beta testing of a FX offering to enable clients to move money around quicker and cheaper. We’re also developing a Cash Hub offering which will centralise cash on platform, supporting the investment lifecycle with FinClear, and will ultimately offer multi-currency digital wallets. More on this in the coming months.

Our TC trading platforms include desktop, web based and mobile trading applications for investment professionals. TCAdviser (or TCA) is our flagship trading product; a feature and data rich desktop trading application which provides an economical alternative to the market incumbent at a time where ongoing price hikes by incumbents are really hurting the industry. The growing market adoption of our TCA product shows many clients are now voting with their feet and adopting new systems in a bid to reduce ever-increasing operational costs.

Helping address digitisation, scale and driving efficiencies

TC also includes a middle office module called TCOps which helps a Market Participant’s operations team enhance day-to-day functions and take more control over the client’s experience, while still leaving the heavy lifting to FinClear. We’ll be releasing several new features in TCOps in the coming months along with a facelift to improve the user experience and system operability.

Integration to online, paperless account opening applications is available via existing partner integrations and we continue to invest into our post-trade support teams, systems and activities. This is critical to our core business and that of our clients.

We also have an extensive API suite which is used by our FinTech clients and more recently has been adopted by our Market Participant clients to enhance their client experiences and drive operational efficiencies. We’re seeing a significant shift from file-based data transfers to APIs.

Innovation

Our investment in and development of FCX is relevant as it’s not just about solving challenges for the private markets but also about leveraging our expertise and technology capability into a post trade ecosystem that manages the settlement and clearing functions in real time. With cash and stock locked on the platform and the ability to move cash in real time via the banking New Payments Platform (NPP), there is no need for a two-day settlement & clearing cycle. This product has the potential to completely revolutionise the settlement process and remove the significant capital costs associated to clearing.

The future is Clear

TPC continues to be a critical pillar for Australian markets infrastructure and one that FinClear remains committed to. We have invested significant expertise and capital over the last eight years to build Australia’s leading TPC offering, and we are committed to continuing this into the long-term. TPC is a dynamic, technically sophisticated service offering that generates significant value for FinClear and its clients. I have no doubt that it will continue remain at the forefront of change and innovation in Australia’s financial services for many decades to come.

Author: Andrea Marani, CEO of FinClear Execution & Clearing Services

It was great to see David Ferrall join the plenary panel discussion at the ASIC forum in Melbourne this week. During this session, fellow panelists Calissa Aldridge from ASIC, Marnie Reid from Computershare and Tony Mackay from XB Market Ventures, discussed how market participants and regulators are harnessing technology.

ASX CHESS replacement may be some way off but, in the meantime, competition must be encouraged through both common interoperability standards and more importantly encouraging innovation and competition in a ‘proportional’ manner. Our market is potentially not large enough to support another ASX lookalike, but the capability exists to encourage competition via other avenues.

Six plus years (2029?) is a long time in tech development/innovation lifecycles – regulators must be encouraged to support innovation in the interim that can deliver better and more efficient investor and issuer solutions. More about the forum and this subject in the AFR.

Read more

Sydney / New York, Nov. 21, 2023 (Nov. 20, 2023 EST) – Eventus, a leading global provider of state-of-the-art, at-scale trade surveillance software across all lines of defence, and FinClear, Australia’s leading provider of trade execution and third-party clearing services, today announced that FinClear has deployed Eventus’ Validus platform for trade surveillance and post-trade monitoring.

FinClear touches one in two retail transactions in Australia, clearing and settling AU$360 billion in transactions each year. The company hosts more than AU$145 billion of listed assets on its existing platform and supports more than 570,000 accounts. It services more than 250 wholesale intermediaries.

Andrea Marani, CEO of FinClear Execution and Clearing Services, said that as the firm has continued to grow, FinClear elected to transition to Eventus from its previous provider for a number of reasons, including the ability to customise the platform, the sophistication of the technology and the proactive dialogue and engagement with the team.

Marani said: “Both of our companies have made a big commitment on this implementation, and this has been much more of a partnership than a vendor-customer relationship. Eventus gave us the opportunity to tailor Validus to the specific needs of Australia’s equity markets. Since deploying the platform, we’ve already seen a marked reduction of false-positive alerts, and we’re now picking up behaviour that we wouldn’t have captured previously.”

With regulators placing an onus of responsibility on brokers to monitor trading activity and help maintain market integrity, he said it is incumbent on FinClear to report suspicious activity to provide accurate data to the regulators on a daily basis.

Marani added: “There have been severe penalties imposed on brokerage firms for not doing so. These responsibilities continue to increase, and Eventus software will be an essential tool to assist in managing these responsibilities.”

Eventus CEO Travis Schwab said: “FinClear plays a significant role in the Australian broking community. We’ve truly established a mutually beneficial relationship, and the firm’s interest in collaborating with us to not only customise the product for its needs but help us tailor the product for the Australian market generally has been extraordinarily beneficial.”

About Eventus

Eventus provides state-of-the-art, at-scale trade surveillance software across all lines of defence. Its powerful, award-winning Validus platform is easy to deploy, customise and operate across equities, options, futures, foreign exchange (FX), fixed income and digital asset markets. Validus is proven in the most complex, high-volume, and real time environments of Eventus’ rapidly growing client base, including tier-1 banks, broker-dealers, futures commission merchants (FCMs), proprietary trading groups, market centres, buy-side institutions, energy and commodity trading firms, and regulators. Clients rely on the platform, coupled with the firm’s responsive support and product development, to overcome its most pressing trade surveillance regulatory challenges. For more, visit www.eventus.com.

Vol 21, No 20: After finishing high school, David Ferrall enrolled at the University of Tasmania, but decided to quit after three months. “I worked as a photographer for a newspaper at a creative studio in Tasmania. That didn’t last very long, so I went travelling for a couple of years. I sailed around the world delivering yachts. Starting from Darwin to South Africa, around to Brazil, up to the Caribbean, then across to the UK before settling for a while in the south of France,” he says.

Ferrall was living the dream. But it was short lived. One day, while in the south of France working on boats, he looks up to see his father, handing down an ultimatum: “I think it’s time you came back home and got a real job. Working on boats and sailing around the world is not a real job.” “Your flight is booked for tomorrow,” his dad said. “But first you have to go back to Tasmania, pick up a car, put it on the ferry, drive up to Sydney and then start working the following Monday.”

In mid-1985, Ferrall began working as a phone clerk or a “runner” on the old open-outcry trading floor of the stock exchange, the days of old when orders were communicated over the phone and cumbersome paper trails were made. His boss was none other than Rene Rivkin.

Read the full article here.

We do need to make one small correction to this printed article. FinClear actually clears and settles $360 billion transactions each year (not $60 billion). We had to pop that in – it’s something we are very proud of.

If you have CHESS fatigue, you are not alone. You have been hearing about the ASX’s attempt to upgrade its clearing and settlement system with distributed ledger technology on and off for seven years now. After recent developments, the case looks more challenging than ever. Why is the CHESS replacement project so frustrating for everyone – including the ASX itself?

The CHESS upgrade is entangled with wider market issues due to its current monopolistic nature. It is not just an upgrade – it currently represents changes to Australia’s only clearing and settlement agency, that could restrict any other entrants and so dictate and limit our infrastructure for years to come.

There are two common denominators to the current situation:

1. Sensible industry participants, FinClear included, are supporters of the upgrade and want a similar solution that scales and will not cause mass disruption and (further) costs to the industry.

2. It is undeniable that competition will bring innovation and efficiencies (including cost reduction) to the market. See evidence for this in “From Laggard to Leader” Mandala Group research report commissioned by FinClear.

These market needs must be separated in order to succeed. The priority for ASX must be upgrading critical market infrastructure as quickly and smoothly as now possible, making it scalable and with some incremental enhancements, but no fundamental changes.

The ASX should not simultaneously be leading industry discussion around how to bring competition into the Australian settlement and clearing market. What is needed instead is an impartial industry body to write a framework mandating open standards for clearing and settlement, which ASX’s upcoming CHESS upgrade must abide by, as well as any potential new entrants or innovation that will be made possible by such standards.

Below we explain the benefits of such a framework, the standards it must cover, and the potential areas it could bring competition, innovation, and efficiencies.

Interoperability is fundamental

The ASX’s plans to use ISO20022 messaging won’t bring competition to clearing and settlement. It will allow participants to use a wider variety of back-office systems to work with CHESS, bringing competition and flexibility to that one component. But this won’t address CHESS as the single clearing and settlement agency in Australia.

To have a pathway to competition we need a set of interoperable interfaces open to anyone (with the correct licencing agreements) – and not bespoke to CHESS. CHESS needs to work within these open and interoperable frameworks – which would form a set of guardrails for the Australian clearing and settlement eco-system – alongside any other market participants or potential competitors.

The ASX should not be leading this discussion, but CHESS upgrades should conform to these guardrails so that the Australian market has a single set of principles for all, to open up clearing and settlement functions to other parties in future. These should be set before the next CHESS replacement project starts, so that it can conform to – not dictate – these principals.

If we plan and build these open interfaces now, we will pave the way for potential competition in the future. More importantly, if we fail to do so, we will cement the ASX CHESS monopoly for the next twenty years, shutting out the possibility of innovation, price reduction, and optimisation via competition.

Click here to continue reading the full article as featured in SIAA.

To download the full report, click here

FinClear Execution & Clearing Services is delighted to announce its enhanced version of TradeCentre Adviser – available now. TradeCentre Adviser is an intuitive, out-of-the-box desktop platform, with quick and easy access to trading, market data, watchlist, account and portfolio tools in a single, customisable workspace.

The new version optimises existing capabilities, bringing an improved user experience that takes customisation one step further. With a sharper look and feel, it provides users with a more intuitive experience. You can now build exactly the workspace you want with the new Widget Explorer. Manage client orders in our optimised order pad widget and have visibility into client accounts, holdings, positions and contract notes, all in one single platform.

TradeCentre – Cost Effective Platform

Our advisers choose TradeCentre for its powerful capabilities and overall cost savings. TradeCentre Adviser can be used as a Primary OMS, or a Disaster Recovery BCP solution, depending on your business needs. 

TradeCentre is integrated with ASX and Cboe exchanges, International markets and operates in conjunction with third party systems, such as Iress.

What’s new?

For an overview of the changes, watch the video below:

Time to download the new and recommended version of Trade Centre here, you can watch the video on how to install and log into TC by clicking here.

For more detailed info, click here.

Email sales@finclear.com.au or call 1800 649 518 for a demo of the new features.

On September 14 FinClear hosted 90+ clients, shareholders, regulators and industry experts at the FinClear Forum at MA Financial in Sydney, where it launched the recently commissioned Mandala Report on competition in Clearing & Settlement.

As part of FinClear’s ongoing commitment to highlighting the importance of Australia having a world leading Clearing & Settlement system, it recently commissioned an in-depth research report to explore the need to modernise Australia’s current system.

The report titled From Laggard to Leader: Why the capabilities that power Australia’s Clearing & Settlement services are falling behind global leaders, and how we can get back to the front of the pack. Was presented by Lindsay Jones from the Mandala Group.

As well as launching the report David Ferrall was also joined by Greg Medcraft, a well respected high profile industry expert and former ASIC chairman who echoed the findings published in the report as well as the sentiments put forward in David’s presentation which also covered technology and what we are doing at FinClear with FCX. The event was officially opened by Chris Barter.

A full copy of the report can be accessed via the Mandala website here

Acquisition to create preeminent offering to meet increasing customer demand

Sydney, 1 August 2023 – FinClear, Australia’s leading independent technology and infrastructure provider for financial market access, clearing and settlement services, has today announced its acquisition of Transact1, a cash investment technology provider for wholesale and institutional customers.

Transact1 operates a robust cloud-based platform that hosts the majority of Australia’s deposit-taking financial institutions, including the Big Four.  It also hosts numerous leading international banks. It offers institutional and wholesale investors an aggregated range of cash investment products and provides automated price discovery, portfolio optimisation, administration, and compliance services to meet regulatory demands and ongoing risk management.

This strategic acquisition positions FinClear to take advantage of the growing demand for cash investment products among clients and the broader market. Additionally, Transact1 ideally positions FinClear to meet wider market demand for cash products expected over the coming years.

Transact1 also offers institutional and wholesale investors the Wealth Cash Income Fund,  a term deposit managed fund for smaller cash investments which Transact1 then diversifies across numerous banks to meet necessary compliance requirements and risk profiles. This will provide FinClear customers with the ability to readily access a portfolio of high interest earning term deposits without the administration burden.

Transact1 is based in Brisbane and expands FinClear’s geographical presence to a fourth state in addition to existing offices in Sydney, Melbourne and Perth.

Commenting on the acquisition, David Ferrall, Founder and CEO of FinClear Group, said: “We’re thrilled to welcome Transact1 into the FinClear Group. It is an exceptional business with a proven track record of combining technology, strong client and banking relationships, and expertise in cash investing.

He added: “Our thesis for FinClear has always been, to achieve critical scale in our core operational business and then begin adding further products and services that deliver genuine benefits to our clients. Enhanced cash management capabilities have become a core requirement for our clients given current economic conditions and we look forward to collaborating with Bill Keogh and his team to scale this offering and take advantage of the technology, IP and relationships the acquisition will bring.”

The Brisbane-based Transcact1 team will continue to be led by CEO, Bill Keogh.

Bill Keogh, Founder of Transact1, expressed his enthusiasm about the partnership:

“We are delighted to join forces with FinClear at a time when cash returns are important to super funds and other institutions who are seeking an aggregated view of cash products. The confidence in getting the best price, using automation to transact while meeting compliance requirements has become paramount.”

“With FinClear’s support, we are well-positioned to scale our business and engage with a broader set of counterparties, meeting the evolving needs of the market,” Keogh concluded.

The acquisition of Transact1 fortifies FinClear’s commitment to expanding its offerings and providing cutting-edge solutions to the financial services industry. The combined expertise of the two companies will create unparalleled opportunities for clients seeking reliable and efficient cash investment services.

AFR

Magellan should return capital to win back investors: Sandon

Sandon Capital says Magellan should abandon its plan to rebuild its funds under management to $100 billion and instead focus on returning at least $300 million to shareholders.

James Thomson Columnist

Jun 27, 2023 – 5.00am

Activist investor Sandon Capital says Magellan should abandon its plan to rebuild funds under management to $100 billion, and instead focus on returning at least $300 million to shareholders as part of a broader push to restore investor faith.

Sandon argues that Magellan, which has suffered a share price plunge of almost 90 per cent to $8.61 since the stock peaked in February 2020, could be worth more than $15 a share, even if FUM grows only marginally from the $41.4 billion reported earlier this month.

Magellan’s FUM peaked at $116 billion in November 2021, as the company rode the pandemic boom in growth stocks under the leadership of co-founder and former chief investment officer Hamish Douglass.

Read the rest of the article

AFR

Second CHESS replacement attempt shows ‘past lessons not learnt’

James Eyers

May 12, 2023 – 4.51pm

History is repeating itself as the project to replace the CHESS drags on, say equity market participants, raising fresh concerns that the ASX’s second attempt to upgrade the sharemarket’s post-trading systems lacks sufficient transparency.

Respondents say this includes failing to bring the industry in on important decisions.

Submissions to a parliamentary committee overseeing the ASX suggested that the market operator had not learnt the lessons of the past, after it botched an initial attempt to replace CHESS last year, and is still being driven by conflicts of interest.

Read the full article

New York – May 9, 2023

Digital Asset and leading market participants announce their plans to launch the Canton Network, the industry’s first privacy-enabled interoperable blockchain network designed for institutional assets and built to responsibly unlock the potential of synchronized financial markets. Canton Network participants include 3Homes, ASX, BNP Paribas, Broadridge, Capgemini, Cboe Global Markets, Cumberland, Deloitte, Deutsche Börse Group, Digital Asset, The Digital Dollar Project, DRW, Eleox, EquiLend, FinClear, Gambyl, Goldman Sachs, IntellectEU, Liberty City Ventures, Microsoft, Moody’s, Paxos, Right Pedal LendOS, S&P Global, SBI Digital Asset Holdings, Umbrage, Versana, VERT Capital, Xpansiv, and Zinnia.

The Canton Network will provide a decentralized infrastructure that connects independent applications built with Daml, Digital Asset’s smart-contract language. It creates a ‘network of networks’, allowing previously siloed systems in financial markets to interoperate with the appropriate governance, privacy, permissioning and controls required for highly regulated industries. The Canton Network enables financial institutions to experience a safer and reconciliation-free environment where assets, data, and cash can synchronize freely across applications. This creates opportunities for financial institutions to offer new innovative products to their clients while enhancing their efficiency and risk management.

For example, asset registers and cash payment systems are distinct and siloed systems in today’s markets. With the Canton Network, a digital bond and a digital payment can be composed across two separate applications into a single atomic transaction, guaranteeing simultaneous exchange without operational risk. Likewise, a digital asset could be used in a collateralized financial transaction via connection to a repo or leveraged loan application.

Capturing the benefits of public blockchains without the flaws

Until now, smart contract blockchain networks have not achieved meaningful adoption among financial institutions and other enterprises because of three significant shortfalls:

▪ The lack of privacy and control over data: other chains have shortcomings around privacy that prevent the use of the technology by multiple regulated participants on the same network.

There are currently no other blockchains that can offer data protection or control at any layer of its network.

▪ Other blockchains have had to accept trade-offs between control and interoperability: other chains require operators to forfeit their full control of applications by using a shared pool of validators to gain interoperability.

▪ The inability to scale: with applications competing for global network resources and the inherent capacity limitations caused by how public blockchains operate, achieving the scale and performance financial institutions need remains challenging.

The Canton Network removes these obstacles by uniquely balancing the decentralization of a network with privacy and control essential to operating within a safe and sound regulatory environment. Only the Canton Network enables participants to safeguard permissions, exposure, and interactions across the network, to comply with security, regulatory and legal requirements.

The network can connect innovative blockchain solutions in market today, such as Deutsche Börse Group’s D7 post-trade platform and Goldman Sachs’ GS DAP™, while retaining privacy and permissioning. As more Daml-built applications go into production this year and beyond, the number of connections on the Canton Network will grow exponentially. For example, one application’s monthly notional traded exceeds the most active crypto token volumes.

Canton Network participants will begin testing interoperability capabilities across a range of applications and use cases in July.

Notes to the editor

Here is what market participants have to say about the Canton Network.

“The Canton Network is another example of Capgemini and our partners harnessing the power of blockchain to build a financial ecosystem that everyone can depend on. This global blockchain network will revolutionize the way institutional assets transact by creating a safe system and trusted corridor.” Sankar Krishnan, Head of Digital Assets and FinTech at Capgemini

“At Cboe, we believe the tokenization of real-world assets may offer an unprecedented opportunity to create new market infrastructure and drive efficiency in the trading of products across the globe. By leveraging new blockchain technologies, we can potentially unlock new opportunities for market participants. Efforts like the Canton Network will help our industry further explore this frontier.”

Cathy Clay, Executive Vice President, Global Digital and Data Solutions, Cboe Global Markets

“The Canton Network is a powerful answer to industry calls for a solution that harnesses the potential of blockchain while preserving fundamental privacy requirements for institutional finance. This unique approach, coupled with the ability to execute an atomic transaction across multiple smart contracts, is

the building block needed to bring these workflows on chain. DRW is proud to have participated in the founding of Digital Asset and today is excited to see this transformative project come online.”

Chris Zuehlke, Partner at DRW and Global Head of Cumberland

“Deloitte’s Advisory and Consultancy teams are committed to providing their deep experience in deploying interconnected applications across the Canton Network. We are proud to support Digital Asset in serving institutions that are reinventing the industry through tokenization of assets, facilitating rapid cross-organizational settlement, creating new marketplaces, establishing an immutable record of shared data, and facilitating secure transactions across the Canton Network. This blockchain network marks the first of its kind, and we are thrilled to collaborate with global leaders embarking on a more connected and efficient future for financial services.”1

Joseph Cody, principal, Deloitte Consulting LLP

“The Canton Network vision strives to enable seamless connectivity across various blockchain networks in the industry. Such solutions are a key building block for future digital and distributed financial market infrastructures.”

Jens Hachmeister, Head of Issuer Services & New Digital Markets at Deutsche Börse Group

“We are proud to be a founding participant of the Canton Network. For the first time, financial institutions can realize the full benefits of a global blockchain network while operating within the regulatory guardrails that ensure a safe, sound, and fair financial system. This is a significant step forward for the blockchain space. We look forward to helping this founding group of network operators and users build and connect applications to the Canton Network.”

Yuval Rooz, Co-Founder and CEO at Digital Asset

“We strongly believe that for a digital currency to be widely adopted, it should possess the same fundamental characteristics as fiat currency, such as security, scalability, and stability. We are pleased to see that the Canton Network’s technical approach to privacy aligns with our values and look forward to exploring the potential of their platform.”

Jennifer Lassiter, Executive Director, The Digital Dollar Project

“By providing a shared network of trust and transparency, the Canton Network enables participants to leverage the power of decentralized technology, access new markets, and drive innovation. Our transformative 1Source initiative, which we are building on the Canton ledger, will serve as a single source of truth for securities finance transactions and will be available to all participants, vendors and market infrastructures globally. The result will be a more efficient, interoperable and future-proof securities finance market.”

Ken DeGiglio, Chief Information Officer, EquiLend

“At Eleox, we are digitizing the energy commodities’ post-trade processes, utilizing distributed ledger technology. The Canton Network will bring a level of transparency, security, immutability, and efficiency to our platform that will transform our customers’ current manual post-trade processes.”

Matthew Almy, Chief Executive Officer, Eleox

“The Canton Network is an important piece of global financial infrastructure that effectively addresses a critical gap in the blockchain market. Digital Asset continues to innovate with Daml to move the industry forwards.”

David Ferrall, FinClear Founder and Group CEO

“As a global company, specializing in emerging technologies in financial services, such as Blockchain and DLT, IntellectEU is excited to be supporting the launch of the Canton Network. We believe that the network will drive further traction and transform the way businesses operate, leveraging network effects and interoperability. As such, we have enhanced our flagship product, Catalyst Blockchain Manager, to support the Canton Network and on top of that we are enabling state of the art solutions for finance.”

Hanna Zubko, CEO & Co-Founder, IntellectEU

“The Canton Network has the power to generate new economic opportunities and fundamentally reshape industries. We are thrilled to be a part of this dynamic network and are eager to enable our portfolio companies to safely and securely build cutting-edge applications on the platform.”

Emil Woods, Partner, Liberty City Ventures

“We are excited to be a supporting partner of the Canton Network. We look forward to helping the financial community build and scale cloud enabled Web3 applications on Azure while harnessing the power of AI to improve the user experience and drive developer adoption.”

Rashmi Misra, GM AI & Emerging Technologies, Business Development at Microsoft

“At LendOS, we are building a modern platform that will redefine critical market infrastructure in lending. When selecting technology, we think about current needs while planning for where clients and market forces will take us in the future. We chose Daml and the Canton Network because they offer essential qualities such as privacy while affording us the freedom to rapidly evolve.”

John Olesky, CEO, Right Pedal LendOS

“We look forward to the promise of an interconnected network of trusted financial institutions utilizing DLT technology provided by Digital Asset and to the efficiencies and new possibilities that derive from it.”

Fernando Vazquez Cao, CEO of SBI Digital Asset Holdings

“Our enthusiasm is robust as we leverage the Canton Network to collaborate with the world’s largest institutions to design, develop and deliver digital applications that can connect through an innovative

blockchain network. This network will be the catalyst for regulated financial institutions to operate together on a grand scale.”

Will Womble, CEO, Umbrage

“In the future, the VERT platform for rural credit financing across the Brazilian market will leverage the Canton Network to enable greater market participation with global financial institutions.”

Martha de Sá, CEO of VERT

“Sharing real-time data updates across the insurance value chain, while safeguarding sensitive information and ensuring scalability to accommodate a fast-growing digital marketplace, is essential for success. The Canton Network’s capacity to facilitate powerful connections across the value chain is a critical factor for us, and we are excited about its potential benefits.”

Michele Trogni, Chief Executive Officer of Zinnia and Operating Partner at Eldridge

About the Canton Network

The Canton Network is the financial industry’s first privacy-enabled interoperable blockchain network designed for institutional assets, launched by a group of leading financial institutions, infrastructure providers, technology firms, and consultants on 9 May 2023. The Canton Network’s design overcomes the shortfalls of existing smart-contract blockchain networks and enables previously siloed systems in finance to become interoperable and synchronized in ways that had been impossible before. Offering the privacy and controls required for highly regulated organizations, the Canton Network creates a safe and sound environment in which assets, data, and cash can move freely across applications in real time, unlocking new efficiencies and powering innovation.

You can access the submission by clicking the link:

AFR

James Eyers

May 1, 2023 – 5.00am

The ASX has raised concerns that legislation designed to create more competition in clearing and settlement of the equity market could give too much power to the federal government and to the competition regulators.

But the sharemarket operator has otherwise backed the proposal – released as a draft by the Albanese government in March – unveiled after it conceded that it was unable to proceed with the blockchain replacement for the CHESS settlements system.

But it wants a clearer delineation between new powers to be given to the Australian Competition and Consumer Commission and those being given to the Australian Securities and Investments Commission. This would avoid overlap and inconsistency. For example, the ASIC rules should not address pricing issues, the company wrote in a submission to the government as it considers the legislation.

Read the full article

DF:

It was great to chat about DLT and how Blockchain tech transforms equity markets on @ReDeFined podcast. We discussed @FinClear and our @FCX platform for trading unlisted securities, as well as how DLT could transform the current financial infrastructure and bring real-time transactions and a single source of truth to investment and trading.

You can listen to the full episode below. Thanks to @Jeremy Almond and @Megan Guy for having me.

Financial Newswire

Govt urged to take ASX out of CHESS replacement equation

Mike Taylor

5 April 2023

The ability of the Australian Securities Exchange (ASX) to competently deliver on a CHESS replacement has been openly questioned by a competitor in the space, FinClear Holdings, in a cutting submission filed with a key Parliamentary committee.

FinClear has claimed that there are now three options open to regulators in dealing with the CHESS replacement exercise and each of those options involve looking to providers other than the ASX.

Indeed FinClear has gone so far as to recommend that the Council of Financial Regulators step in and redesign the approach (instead of the ASX).

Read the full article

The Australian

FinClear says the ‘unpicking of the ASX’ is possible as it is subjected to clearing and settlement inquiry

By DAVID ROSS

4:24PM MARCH 30, 2023

Financial services technology operator FinClear’s chief executive, David Ferrall, says plans to empower regulators to intervene in disputes over settlement and clearance could result in the “unpicking” of the Australian Securities Exchange’s dominance in equities trading.

The federal government last week announced it would begin consultations in preparation for a Bill that would empower of regulators to intervene in market disputes, in what Treasurer Jim Chalmers said was aimed at “providing emerging competitors fair, transparent and non-discriminatory access to market infrastructure”.

This could see the ASX’s monopoly on cash equity clearing and settlement broken up.

Mr Ferrall said although the ASX made little profits from its clearance and settlement systems, it was baked into the structure of the equities market.

Read the full article

Reuters

Australia market major backs plan to break ASX monopoly on post-trade functions

Published on March 24, 2023 05:17 PM AEDT

By Byron Kaye

SYDNEY (Reuters) – A top Australian share trading technology firm backed a government proposal to break stock market operator ASX Ltd’s effective monopoly over clearing and settlement, saying its failed software overhaul showed the need for new entrants.

In draft legislation published this week, the federal government said it wants to give potential rivals to the ASX’s clearing and settlement operations the same access to financial market infrastructure.

The new rules would also give the Reserve Bank of Australia and the Australian Securities and Investments Commission, which jointly regulate the ASX, greater oversight of clearing and settlement providers to stop dominant players pushing out competition.

Read the full article

Australian

Government announces it will intervene in the ASX monopoly and hand regulators more powers

By DAVID ROSS

6:51PM MARCH 23, 2023

The federal government will wade into the Australian Securities Exchange’s monopoly, announcing plans that would hand great powers to intervene in disputes around the pricing and operation of financial markets to regulators.

The Albanese government on Thursday announced it would intervene in the trading and clearing operation as part of a major shake-up of Australia’s financial system.

Treasurer Jim Chalmers said draft legislation was aimed at “providing emerging competitors fair, transparent, and non-discriminatory access to market infrastructure”.

Read the full article

AFR

Chalmers moves to break ASX monopoly on settlement

James Eyers and John Kehoe

Mar 23, 2023 – 6.44pm

Treasurer Jim Chalmers will empower regulators to create competition in the $2.5 trillion equities market, a move that could end the ASX’s monopoly on clearing and settlement after the exchange’s $250 million failure to replace these systems.

The Albanese government released draft legislation after the market closed on Thursday to give the Reserve Bank and Australian Securities and Investments Commission – co-regulators of the clearing and settlement facilities – new “rule-making” powers over the ASX.

The Australian Competition and Consumer Commission will also get new arbitration powers to allow it to mediate disputes by potential competitors seeking to provide the services.

Read the full article

ANDREA MARANI APPOINTED CEO OF FINCLEAR ECS

FinClear Group COO steps up to run the Execution & Clearing Services, as FinClear continues to grow

Sydney, 9 March – FinClear, Australia’s leading independent technology and infrastructure provider for financial market access; execution, clearing and settlement services, is pleased to announce the appointment of Andrea Marani as CEO of its Execution and Clearing Services, effective 1 March 2023.

FinClear founder David Ferrall will remain Group CEO and MD. After strong and continuing growth, and the recent launch of unlisted securities platform FCX, the business continues its expansion with several active roles currently open, and internal appointments to support sustainable future growth, including Dan Bower appointed to Chief Product Officer.

David said the appointments were an exciting step preparing for the next phase of the business. “FinClear’s great strength is our people – we have an incredible team that have built our success and are changing Australia’s financial infrastructure.

We are proud that every employee is a shareholder and will share financially in our long-term success. We continue to offer developing opportunities for our team, and to attract leading, senior people to the business. Since 2015, FinClear has swelled to 200 employees across three States, with 25% growth since the beginning of 2022.”

Andrea has over 20 years global experience in financial services, including 6 years as COO then CEO and MD of OpenMarkets Australia where he built the company from a startup to a top 15 ASX Market Participant.
Andrea has held senior management and executive positions at a variety of leading financial institutions including Shaw & Partners, Wilson HTM, Global Trader, Rabobank, Bankers Trust, JP Morgan and Investec and has worked in Europe and Africa.

Commenting on his appointment, Andrea said: “It has been a privilege to be part of FinClear’s remarkable progress over the last few years, and I’m excited to be stepping into our next phase with my brilliant team. FinClear goes from strength to strength because of our wealth of talent and because we are providing services the market really needs in the best way it needs them.”

Andrea has a BCompt majoring in Accounting and Auditing from University of South Africa.

FinClear is the dominant market provider in Third Party Clearing and Execution, with around 200 paying clients each month and over 500k end clients on its listed platform. FinClear continues to build out its platform capabilities, most recently represented by its burgeoning FCX platform – a global first that demonstrates FinClear’s ability to continually innovate.

SENIOR WRITER

8:08PM FEBRUARY 23, 2023

Stockbrokers, share registries and other stakeholders around the ASX have already spent as much as $250m preparing for its stalled blockchain-based replacement program for its CHESS clearing and settlement program, a federal parliamentary committee has been told.

Appearing before the Parliamentary Joint Committee on Corporations and Financial Services at a public hearing in Sydney on Thursday, FinClear chief executive David Ferrall said the ASX’s offer of $15m in terms of a fee rebate for its partners who are working with it on the replacement program did not go anywhere near what had been spent so far.

The ASX suspended its planned blockchain-based replacement program last November pending a rethink of the project, and is now promising to announce its updated plans by the end of the year.

Read the full article here

DAVID FERRALL

THE AUSTRALIA

4:01PM FEBRUARY 22, 2023

The announcement from the ASX last Thursday will do little to comfort many stakeholders and regulators in the long-running CHESS replacement saga.

When CHESS was launched, it was world-leading, and assisted Australia to attract an outsized share of global investment. But after nearly three decades, it is dated compared to the technologies our global peers are implementing.

As I stated in December, we need to embrace world-leading technology to remain world beaters, for the sake of our industry, investment and all consumers who will end up footing the bill

Read the full article here

Forbes

How distributed ledger could take you from startup to IPO

By Elise Shaw

January 17, 2023

The FCX platform combines technological and regulatory expertise and rigour to tokenise securities securely.

Lived experience can be a creative catalyst for an entrepreneur.

In 2015, David Ferrall founded FinClear, the parent company of FCX, Australia’s first securities platform for unlisted companies built on distributed ledger technology. When he built FinClear, he realised there was nothing similar for unlisted companies.

“We saw, as an early-stage startup company ourselves, that there was nothing like in our world in the unlisted world,” he tells Forbes Australia in an interview.

He founded FinClear in 2015 with the idea that clearing and settlement in Australia needed more competition. Now, the business services one in every two listed product transactions flow through ASX and Chi-X every day.

Since its launch in November, around 30 companies have joined the FCX platform, from startups to the largest being FinClear, which was valued at around $500 million when they raised $20 million about a year ago, Ferrall says.

Read the full article here

ASX dumping its $250 million replacement of the CHESS system has brought a lot of attention to the technology underpinning markets.One of the other players in this space is FinClear, Australia’s leading independent technology and infrastructure provider for financial market access. David Ferrall, founder and CEO of FinClear, tells Sean Aylmer how FinClear has developed FCX – Australia’s first unlisted company securities platform.

Listen to the Podcast

AFR

James Eyers Senior Reporter

Dec 8, 2022 – 4.01pm

Digital Asset, the start-up that was building the new settlement system for the Australian equity market, has declared the ASX must shoulder the blame because it changed the scope of the project and never created a plan to fix core issues as it began to unravel.

The retort from the New York-based company comes after ASX chief executive Helen Lofthouse earlier this week told a parliamentary committee that “escalating delays” in software development at Digital Asset were one of the key reasons behind the ASX’s decision to pull the plug on the project.

This triggered a $250 million write-down, set the critical market infrastructure upgrade back at least five years, and triggered a loss of faith in ASX’s capability to manage technology, infuriating the Reserve Bank and corporate regulator.

Read the full article here

The AFR

James Eyers Senior Reporter

Updated Dec 6, 2022

ASIC chairman Joe Longo says the ASX board needs to act urgently to restore confidence in its ability to deliver a new settlement and clearing system for the equity market.

The nation’s top corporate regulator also says ASX must be more consultative and open to new ideas from market participants outside the exchange if it is to regain the trust of its stakeholders.

Read the full article here

Clearing and settlement modernisation will not succeed without finding a sensible way to introduce new technologies and allow competition with incumbent exchanges.

AFR

David Ferrall CEO FinClear

The AFR

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.

Read the full article here

Ledger Insights – 25 November 2022

Today FinClear, one of Australia’s largest settlement firms for listed securities, has gone live with a blockchain-based platform for tokenized unlisted securities, FCX. It uses Digital Asset’s Daml smart contract language, the same used in the stalled ASX CHESS replacement.

One of Australia’s big four banks provides a facility to automate money movement between a bank account and cash tokens in an FCX wallet. The tokenized cash is then used to settle equity purchases instantly and atomically. We don’t know which bank is involved with FCX, but ANZ was involved in a stablecoin project earlier this year.

Stepping back, FCX enables private firms to use the platform to issue new tokenized stock to investors. Underpinned by distributed ledger, a company can manage the entire process, including the offer information, documents and settlement, providing permissioned access to potential investors. Once an investor pays for the stock, it appears instantly in their FCX wallet. The issuer can keep tabs on the entire process.

The solution enables companies to easily manage the list of investors, the cap table. And FCX plans to enable secondary trading of private equities next year.

“The FCX platform is combining technological and regulatory expertise and rigour to tokenise securities in a secure way, which is a totally different proposition to a cryptocurrency,” said David Ferrall, Founder & CEO of FinClear. “We are applying our extensive experience in highly regulated, listed markets to give unlisted companies and investors the security they deserve.”

Three companies are using the platform so far, including FinClear itself, givvable and Circle In.

While blockchain is often seen as democratizing finance, as with many other jurisdictions, Australia restricts access to private company offerings to ‘sophisticated’ investors, the equivalent of accredited investors.

Some see unlisted securities as low-hanging fruit for distributed ledger applications. That’s because of the efficiencies in the public markets and the increasing number of unicorns staying private. In the United States, the DTC is progressing with its Project Whitney with plans to launch a private stock and digital assets solution, the Digital Securities Management (DSM) Platform, subject to SEC approval.

Some of the more institutional offerings include Switzerland’s daura, which has collaborated with the SIX Digital Exchange, ADDX in Singapore and France’s LiquidShare, which also uses Daml. There are several public blockchain security platforms, such as iStox, Securitize and Tokeny.

FCX introduces facilities enabling automated equity raising for unlisted companies & capabilities with Big 4 Bank for investors to make instantaneous, secure investments through digital ledger technology

Welcomes first group of unlisted companies onto the unlisted market

Sydney, 24 November 2022 – FCX, Australia’s first unlisted company securities platform built on distributed ledger technology, today announced new facilities that will revolutionise the way that unlisted companies interact with their shareholders and enable cost efficient, secure flow of capital between unlisted companies and investors. Highlights include:

• Realtime, automated capital raising facilities in a market first that will enable unlisted companies to raise equity quickly and efficiently in the same way as publicly traded companies, but without the costs.
• In collaboration with one of the Big Four Australian banks, creating a one click bank-to-digital wallet function that will allow investors to make instantaneous cash deposits and withdrawals between an FCX wallet and a Big 4 bank account to buy and sell shares in unlisted companies via blockchain.
• Applying regulatory rigour and oversight through the experience and expertise of FCX’s parent company FinClear, itself being ASIC and ASX regulated, with legal advice from Ashurst, a recognised global expert in digital ledger technology.
• Partnering with Digital Asset, a leading global technology provider, to utilise its proprietary Daml DLT technology, also being deployed by Deutsche Börse, Hong Kong Exchanges and Clearing, & Goldman Sachs

FCX is also pleased to welcome onto its platform the first wave of unlisted companies looking for a secure venue where they can attract private investors and access growth capital without having to go public.

David Ferrall, Founder & CEO of FinClear, the parent company of FCX, said: “FCX is a unique ecosystem in the unlisted space. It mirrors what FinClear offers in listed shares and what the future standard of markets infrastructure should be.

“The FCX platform is combining technological and regulatory expertise and rigour to tokenise securities in a secure way, which is a totally different proposition to a crypto currency. We are applying our extensive experience in highly regulated, listed markets to give unlisted companies and investors the security they deserve.”

FCX launches Platform Cash with a Big Four bank

Today’s launch of FCX Platform Cash offers investors a way to seamlessly invest, hold, and move tokenised securities. It is an atomic settlement product that will autogenerate cash tokens for use on the platform.

Any eligible investor[1] (including individuals, superfunds, corporates and advisors) can open an FCX wallet in a matter of minutes. They can then deposit cash into a bank account which will generate a cash token in their FCX wallet.

The cash token can be used to buy and sell shares in unlisted companies from the secure, centralised wallet, with FinClear’s atomic settlement capabilities clearing, settling and transferring direct ownership to the end-investor instantaneously.

FinClear Founder & CEO David Ferrall said: “Platform cash offers investors a way to seamlessly invest, hold, and move tokenised assets. This is crucial for a totally transparent, disintermediated future of investment that allows end-to-end control and visibility – at a lower cost – thanks to automation.

“This is just the start of a radically improved financial ecosystem – highly sophisticated proprietary technology is allowing for a simpler, better investor experience.”

Realtime, automated capital raising capabilities now available for unlisted companies

FCX has also gone live with its capital raising capabilities, which offer a radically enhanced way for unlisted companies to raise funds.

FCX’s cash on platform and atomic settlement capabilities (underpinned by FinClear’s infrastructure) enable unlisted companies looking to raise capital to do so quickly, easily and from a centralised venue. The system allows unlisted companies to:

• Conduct fund raisings with full digital automation – replacing the need for manual processing and book building, thereby improving accuracy and security, reducing cost, and almost totally reducing settlement burdens.
• The platform visibility means companies maintain full transparency over the entire process, from control over investor access and permissions, tracking the status of documentation, execution and payments. View of all shares at once means an at-a-glance real time figure for funds raised.
• The capabilities also offer opportunities for data-driven solutions and efficiently structuring capital raises.

With over two and a half million companies trading in Australia,[2] and less than two thousand listed on the ASX,[3] there is a significant opportunity for unlisted companies looking for investors, and for investors looking for smarter investment opportunities.

Innovators givvable, Circle In & FinClear join FCX

FCX is also pleased to welcome the first wave of unlisted companies onto the platform, including its parent company, FinClear.

David Ferrall commented: “Naturally, as a fast-growing company ourselves, the time came when FinClear had to consider an IPO. But instead, we became the first to join FCX – we are able to keep control and offer real equity to employees but still access the investors we needed to continue our ambitious growth. This is a game-changer for Australian companies, and for the Australian economy.”

Early movers onto the platform are indicative of the demand already underway from unlisted companies recognising the huge advantages to be gained from FCX that allow them to stay unlisted for longer through quickly and efficiently accessing private capital with full transparency and security.

Companies include:

• givvable – an AI-powered platform that simplifies supply chain ESG screening, monitoring, and reporting for corporates and governments.
• Circle In – a parental and caregiver support platform equipping organisations of all sizes to build family-inclusive workplaces – amongst them Coca Cola, EY, Atlassian, and Universal. The software platform is a first in digital social infrastructure, helping managers support employees through parenthood and other life pressures.

Dean Jagger, Head of FCX, commented: “We are delighted to have added these innovative, growth companies to the register, giving them access to capital without any loss of control. These early movers are showing what’s possible within a sophisticated, tokenised ecosystem.”

Interest in unlisted company investments is high – fundraising was up 20% last year to reach a record ~$1.2 trillion[4] with further growth this year. In Australia, private capital AUM hit an all-time high in May of $90 billion.[5]

Unlisted companies have contributed $54 billion to the Australian economy in 2022[6] and with a fully digitised, technology secondary market like FCX, these companies will have the ability to access investors and funds to accelerate growth and economic contributions further.

[1] FCX is available to sophisticated investors and their intermediaries that meet the KYC requirements only.

[2] Source: 2,569.900 actively trading businesses in Australian economy at June 30 2022, ABS

[3] Source: 1,986 domestic companies listed on ASX in September 2022, Statista

[4] Source: ‘Global Private Markets Review 2022’, McKinsey & Company

[5] Source: ‘Australian private capital assets at an all time high of $90 billion’, Australian Investment Council

[6] Source: EY, Funding a brighter future, May 2022

Hosted by FinTech Australia, Intersekt is Australia’s leading fintech conference.

Intersekt 2022 was earmarked early on as the first conference with which FCX would be involved.

The conference held on September 7-8 was a huge success. FinClear CEO David Ferrall, Board Director Tracey Ah Hee, and Head of FCX Dean Jagger, proudly represented FCX at a few sessions throughout the program. FCX’s branding was also proudly on full display across the two days of the event.

Watch the video below for a taste of the conference:

For more information about FCX, please visit: fcx.com.au

On the 24th of August, the Sydney office of FinClear welcomed students, teachers, parents, local business owners and event organisers to the Enterprise in the Community 2022 Student Presentation Competition.

Enterprise in the Community (EitC) is an experiential learning program for school students. The design of the program brings school communities and local business communities together to collaborate and solve real-world business problems. Learners experience a journey to discover how to apply life skills that they can use every day. EitC is the brainchild of not-for-profit, SEVENmile and is delivered in conjunction with the NSW Department of Education – Regional Industry Education Partnerships (RIEP).

Wednesday night marked an ‘Australian-first’ as the competition pitted the 5 finalist schools against one another in a live presentation format with 3 independent judges determining the result.

FinClear and our wholly owned subsidiary, FCX, were proud sponsors of the event offering cash prizes to the winning schools and finalists.

FinClear & FCX CEO, David Ferrall, stated “I feel strongly about doing more to nurture Australia’s entrepreneurial spirit and recognise it’s something that should be nurtured and developed from a young age”.

The night was concluded with the team from Balgowlah Boys taking out first place.

Finalist schools (in order of how they finished) included:

• Balgowlah Boys
• St Clare’s College Waverley
• St Paul’s Catholic College Manly
• Alexandria Park Community School (tied for fourth)
• Mackellar Girls (tied for fourth)

See below videos of the night.

Post-event interview with David Ferrall and two students from Balgowlah Boys

Highlight Reel

Live Stream

For more information about EitC, visit: sevenmile.org.au

CEO David Ferrall said he was delighted with the appointment as FinClear continues to grow.

“Tracey is a wonderful addition to our Board, with her depth of international expertise both in startups and mature organisations,” he said. “Over the past seven years, FinClear has grown from a startup to an enterprise underpinning a large proportion of the Australian capital market. We have ambitious plans to build and expand on this success, and we warmly welcome Tracey’s contribution to making those happen.”

Ms Ah Hee has over 20 years global experience in data, analytics and customer experience transformation. At KPMG US LLP in New York she built and led the Data Analytics and Customer Experience group for financial services, consulting to some of the world’s leading banks, insurers and wealth management organisations. She has also built startups into multimillion dollar businesses and has worked in Apac, US, Europe and Africa. She said FinClear was an exciting opportunity for her.

“I have observed FinClear’s growth journey over the past few years and have a lot of admiration for what the team has achieved,” she said. “I am very enthusiastic about their future goals and I look forward to helping bring them to fruition.”

Tracey has a BCom majoring in commercial law from Rhodes University, South Africa and an MBA from MGSM in Australia.

With this episode, David and Dean react to the announcement of the clearing, settlement and wealth management technology and service provider’s new digital facility, FCX, and the future of investing and what that looks like for financial advisers.

In particular, the role of regulation in regards to technology and growing features such as crypto-assets, will play a big part.

“The problem with this unregulated world is that it’s unregulated and the regulators don’t have any transparency. They can’t see into it. It’s all decentralised peer to peer,” David explained.

“Financial markets have always operated up till now on central trusted counterparts that the regulator oversees and can always look into and chase you down if need be… with this centralised capability, that capability is just not there.

“The regulators are struggling with how to regulate that world, how to look at that world, how to make it more transparent.

“Really what we are doing here is saying we actually don’t know how that resolves itself, and it might take some time, but what we are doing is bridging the old world into the new world.”

The next stage of Australian market evolution is almost here, FinClear launches FCX which will change how unlisted companies issue, manage and raise capital.

FCX already hosts our own register, and we will soon welcome other companies to our DLT-based registry.

Next, we will launch capital raising tools that solve the myriad of issues that plague emerging companies in this country today.

Finally, in 2023, we will open a fully licensed liquidity venue to all to trade unlisted company shares. With same-day settlement and a host of start-up-friendly features, FCX is built to turbocharge Australia’s thriving start-up and scale-up ecosystem.

If you missed the launch, watch the video here:

FinClear has announced that it is providing execution and clearing services to Crestone Wealth Management.

FinClear CEO David Ferrall said he was delighted to have secured a client of Crestone’s stature in Australian wealth management.

“Crestone is a premium name in the Australian market and well known for being exacting about who they choose to work with,” he said. “I am extremely pleased that they have chosen FinClear and the team and I are excited to work closely with them.”

Crestone CEO, Michael Chisolm, said FinClear’s client-first culture had been key to his decision.

“Crestone’s success is built on collaboration – with our clients, between our people, and with our service providers,” he said. “FinClear impressed us with its capabilities, technological innovation and commitment to security. Crestone seeks to continue to grow by providing clients unparalleled investment insights and solutions as well as a holistic view of the investment world. This has been achieved by aligning the business with strategic partners, including FinClear.”