ASX completes replacement of 90's era trading tech

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ASX completes replacement of 90's era trading tech
A commemoration to the former Sycom system.

As final decision on blockchain looms.

The Australian Securities Exchange has boasted the successful overhaul of its futures trading system from 90's era proprietary software to Cinnober technology.

In its FY17 full-year results today the ASX revealed it had swapped out the Sycom platform that had underpinned its futures and options trading since the late 1990's with "contemporary" technology that "uses global standards".

It involved the rationalisation of seven legacy systems containing 17 separate applications, as well as the elimination of 20 databases.

The new system currently has 820 users connected and supports 120 customer applications, the ASX said.

ASX customers can now benefit from improved latency and faster resolution of issues, and are now able to manage their own trading limits. It also allows the ASX for the first time to "diagnose and discuss issues proactively with customers".

The exchange attributed the successful go-live to "extensive development and industry-wide testing program" undertaken in the lead up to the release; it said 50 ASX participants and 30 other customers were involved in the preparation.

The delivery of the new futures trading platform was one of the main drivers of a $50.3 million capital expenditure for the year, alongside the assessment of blockchain to replace the CHESS central clearing system.

Blockchain decision to be made in December

The ASX has been consulting with the market on the replacement of its CHESS post-trade equity services system since last September.

It is prototyping an "industrial strength" blockchain-based solution to determine whether the distributed ledger technology can work at the scale of the local equity market.

The ASX is developing the solution with start-up Digital Asset, in which it holds an 8.5 percent stake.

It has pledged to make a decision on the technology before the end of calendar 2017, and today reiterated that it would do so in December.

"CHESS has been a highly robust and reliable platform for over 20 years. Its replacement offers a once in a generation opportunity to significantly improve operating efficiencies for the whole industry," the ASX said.

"[Distributed ledger technology] has the potential to create a ‘single source of truth’ for all transactions that cannot be altered and which can be distributed to those who are permissioned to access it. 

"ASX believes there is a real opportunity to simplify how our marketplace works and unlock a new era of efficiency and innovation."

A third party specialist review will help inform ASX's decision on the technology, it said.

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