The Hong Kong Exchanges and Clearing Limited (HKEX) has announced that it is partnering with a blockchain firm to improve its post-trade processes, according to financial news agency Finextra.
The exchange has been working with Digital Asset for some time and the system is now being tested in the Shanghai and Shenzhen stock exchanges. The overall collaboration is now being called Stock Connect.
The new project not only allows improvement of post-trade times but also allows international and Chinese traders and investors to trade in each others’ exchanges. It also improves the overall efficiency of trades.
While the Pilot program for Stock Connect has been successfully tested, the partnership now aims to develop and deploy a full-service platform that aims to resolve the issues of differing time zones, settlement and operational issues that occur for traders who wish to invest in the Chinese markets. Currently, these issues are being faced because of the tight settlement cycle in place in Chinese markets that is hampering growth.
HKEX is positioning itself at the forefront of blockchain and cryptocurrency development and regulation in the Chinese region and is aiming to regulate them. Earlier, it published a report regarding regulation of these new classes of assets according to existing regulatory frameworks. It insisted that blockchain and cryptocurrencies should be treated as securities so that the exchange could regulate them on its own terms.
HKEX is also looking to acquire more blockchain companies in order to use their technology for Chinese exchange markets. It is also in partnership with other companies involved in DLT.
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