Bursa Malaysia Trialing Blockchain Powered Bonds Marketplace with Singapore’s HashtacsJuly 30, 2020 0 comments
Bursa Malaysia is said to be partnering with Hashstacs to co-develop a blockchain Proof-of-Concept project dubbed “Project Harbour” for its bonds marketplace.
Project Harbour is centred around the usage of Distributed Ledger Technology (” DLT”) as a register in facilitating the growth of Labuan’s bond marketplace. The project will take place in Malaysia’s offshore market, Labuan, in collaboration with the Labuan Financial Exchange (LFX), a wholly-owned subsidiary of Bursa Malaysia.
Project Harbour is aimed at exploring and harnessing the opportunities enabled by blockchain and tokenisation of assets.
The entire lifecycle management of digital bonds will tested and managed on Trident Platform which will be built by Hashstacs. The organisations utilising this plaftfrom includes Bursa Malaysia, Securities Commission Malaysia, Labuan Financial Services Authoirty, CIMB Investment Bank, Maybank Investment Bank, and, China Construction Bank.
They said that the blockchain based platform will facilitate issuances of digital bonds “seamlessly” while providing a “single source of truth to maintain the integrity of investors’ holdings and track transactions”. In addition, smart contract technology automates the movement of funds and securities, amplifying asset servicing and the provision of liquidity to market participants.
This development follows a growing trend of blockchain use cases in the bonds market, one of the first blockchain-based bond was mandated by World Bank and issued by Commonwealth Bank Australia in 2018. Similarly, The Philippine Bureau of the Treasury launched a bond market place together with UnionBank and PDAX in July 2020.
Datuk Muhamad Umar Swift, Chief Executive Officer of Bursa Malaysia, said:
“The Exchange closely follows current trends in innovation and new technologies with a view to remaining relevant in this competitive landscape. One of the ways to achieve this is through collaborations with innovative companies. The POC conducted in partnership with Hashstacs presents an opportunity to provide a valuable learning experience to build knowledge and obtain insights that will allow us to grow the bond marketplace. The POC aims to increase operational efficiency, driving down the cost of operations as well as the cost of issuing bonds. We will continue to tap into emerging technological innovations to further develop the marketplace and improve the effectiveness and accessibility of the Exchange”
Mr Benjamin Soh, Managing Director of Hashstacs Pte Ltd, said:
“Hashstacs will develop a blockchain solution to issue, service, trade and clear bonds on the platform. The creation of an industry wide ecosystem will allow for a complete solution in origination, servicing, trading, clearing and settlement, allowing Malaysia to potentially have the first mover advantage in attracting regional and international bond listings.”
Featured image via Wikimedia Commons