SETL, the post-trade blockchain startup founded by former Chi-X chief Peter Randall, is to work with Computershare on a joint initiative to establish securities ownership registers using distributed ledger technology.
The joint initiative will focus initially on the Australian market and will examine the practicalities of establishing an immutable register of securities ownership using blockchain technology.
Computershare will play the lead role in bringing together issuers, asset owners, brokers, regulators and market infrastructure providers to propose an open platform "which meets the needs of all industry participants".
Paul Conn, president of global capital markets for Computershare, comments: “Computershare is uniquely placed to appreciate how blockchain technology will be specifically applied in maintaining ownership registers. We are already the keeper of definitive legal ownership - the ‘Golden Record’ - for our issuer clients and their stakeholders."
He says the firm chose to work with SETL because of the deep knowledge of capital market practices within the group. Founded by Randall and one-time quant trader Anthony Culligan, SETL recently appointed Sir David Walker, a former executive director of the Bank of England as chairman and hired Professor Philip Bond as head of its cryptography and cyber security committee.
The initial phase will engage a "broad group of participants", says Conn, and will be used to build on SETL’s existing working prototype for transferring ownership of securities. The result is expected to be an open platform which can meet a variety of needs including those of issuers, owners, brokers, custodians, regulators, market infrastructure providers and registrars.
Australia is leading the way in the application of blockchain technology to capital markets trading, with the Australian Stock Exchange working with Digital Asset Holdings to build a clearing and settlement platform using distributed ledger techniques.