Israel will have its first central securities lending platform this November, built on blockchain technology.
The Tel Aviv Stock Exchange (TASE) plans to launch its blockchain-based securities lending pool in November.
In an announcement on July 28, TASE said the platform will serve an essential function in the country’s capital markets, which currently lack a central system for securities lending.
Contrary to the current set-up —— which fails to meet the needs of investors, in TASE’s view — the new blockchain-based system will concentrate all securities lending activities under one roof and enable direct borrowing among investors across a range of major financial instruments.
Tried and tested
In March of this year, TASE launched a dedicated testing environment for the platform, allowing members to execute loan transactions. Drawing on these results, the exchange is adjusting its systems in the run-up to November.
The exchange has highlighted the value offered by blockchain technologies; in particular, support for peer-to-peer transactions, smart contract functionality, and increased transaction security due to blockchain’s immutable quality.
TASE states that this lets the exchange custodians and clients operate at cheaper costs with a higher level of security.
In a statement, Orly Greenfeld — senior vice president and director of the TASE clearing department — said, “Blockchain technology will enable securities lending trading while securing information and supporting the increase in the number of transactions.”
TASE partners include Accenture and Intel
TASE first announced the development of its new platform, which is built on using Hyperledger Sawtooth, in May 2018. The exchange has collaborated on the project with partners that include Accenture, Intel and Israeli fintech The Floor.