The Australian Securities and Investments Commission (ASIC) has launched an investigation into the Australian Securities Exchange (ASX) due to the failure of its blockchain project, which was halted in 2022. The probe aims to identify the reasons behind the project's failures and to shape approaches for future blockchain adoption.
Investigation Initiation and Purpose
ASIC Chair Joe Longo has tasked independent experts to examine ASX’s framework failures. David Clarke stated the ASX is focusing on transformation strategies to mitigate risks. > "ASIC's decision to initiate an inquiry follows repeated and serious failures at ASX. The inquiry provides an independent assessment of whether ASX’s frameworks and practices are fit for purpose to ensure it can appropriately manage these critical financial market infrastructure roles." — Joe Longo, Chair, ASIC.
Challenges in Combining Technologies
The failure of the blockchain project highlights significant challenges in combining traditional financial systems with blockchain technology. The new platform is projected to cost between AU$105 million and AU$125 million.
Global Implications
Historically, institutional blockchain projects have faced technological and operational setbacks. This event mirrors similar disrupted financial infrastructure projects globally. An assessment may shape future regulatory policies and institutional projects in blockchain technology. The ASX’s focus remains on improving technology and risk management frameworks.
ASIC's investigation into the ASX case highlights the need for a more careful approach to incorporating blockchain technology into traditional financial systems. The success of future projects will depend on effectively addressing current issues and avoiding similar mistakes.
