Bursa Malaysia tests blockchain in securities lending POC
07 May 2019 Kuala Lumpur
Image: Shutterstock
Bursa Malaysia Berhad has started testing the opportunities afforded by blockchain technology in securities borrowing and lending (SBL) via a proof of concept (POC).
According to Bursa Malaysia, blockchain technology will develop greater transparency and address other operational challenges associated with the SBL market in Malaysia.
The project aims to improve efficiency, speed and capacity in securities lending supply and borrowing demand.
Meanwhile, several SBL players are collaborating with Bursa Malaysia and FORMS to drive the development of the blockchain-enabled lending pool to suit the industry’s specific needs, cost and efficiency pressure.
Those collaborating include Affin Hwang Investment Bank Berhad, CIMB Investment Bank Berhad, Citibank Berhad, Kumpulan Wang Persaraan, and Malacca Securities Sdn Bhd.
It was noted that this initiative is the first POC project designed to explore and address the challenges faced in SBL in Malaysia.
Datuk Muhamad Umar Swift, CEO, Bursa Malaysia, said: “Across different markets, empirical studies show that short selling helps provide additional liquidity and improves price efficiency.”
“The growth potential of Malaysia’s SBL market makes it a prime candidate where the power of blockchain technology can create a considerable impact.”
“The collaboration also benefits the wider industry through new knowledge, insights and practical experience in harnessing digital innovation to support and drive the growth of the capital market.”
According to Bursa Malaysia, blockchain technology will develop greater transparency and address other operational challenges associated with the SBL market in Malaysia.
The project aims to improve efficiency, speed and capacity in securities lending supply and borrowing demand.
Meanwhile, several SBL players are collaborating with Bursa Malaysia and FORMS to drive the development of the blockchain-enabled lending pool to suit the industry’s specific needs, cost and efficiency pressure.
Those collaborating include Affin Hwang Investment Bank Berhad, CIMB Investment Bank Berhad, Citibank Berhad, Kumpulan Wang Persaraan, and Malacca Securities Sdn Bhd.
It was noted that this initiative is the first POC project designed to explore and address the challenges faced in SBL in Malaysia.
Datuk Muhamad Umar Swift, CEO, Bursa Malaysia, said: “Across different markets, empirical studies show that short selling helps provide additional liquidity and improves price efficiency.”
“The growth potential of Malaysia’s SBL market makes it a prime candidate where the power of blockchain technology can create a considerable impact.”
“The collaboration also benefits the wider industry through new knowledge, insights and practical experience in harnessing digital innovation to support and drive the growth of the capital market.”
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