What do you think about using blockchain technology for operating stock exchanges?
Currently the ASX (Australian Stock Exchange) is processing $6 billion of equity trades each day using three 2½-metre-high racks of servers.
Their CEO, Dominic Stevens, is changing their clearing and settlement system over to blockchain technology and is getting the attention internationally on this project.
You can read more about it here: https://bit.ly/2Zu2nOF
The aim of this technology is to move financial markets closer to real-time settlement of trades, reducing systemic risk.
Note: Systemic risk is a market wide risk, that causes your stocks to drop in value. So it’s an unexpected event that affects the whole stock market, like a Trade War or interest rates rising, rather than a company or industry specific risk, like Musk taking to twitter
If there’s a market wide risk that causes your stocks to drop in value, then being able to execute a sell order closer to real-time means you can sell out of a stock more quickly if you don’t think it will recover or you want to mitigate your immediate loss.
What are your thoughts on this shift in technology?