Malaysia to Develop Blockchain for Borrowing and Lending Securities

Asia Blockchain Review
May 19, 2019

Malaysia’s stock exchange, Bursa Malaysia, has been working on a blockchain-enabled securities borrowing and lending Proof-of-Concept (PoC).

As reported by Cointelegraph, the initiative is seeking to facilitate greater transparency and tackle other challenges associated with borrowing and lending securities in the country.

Datuk Muhamad Umar Swift, the exchange’s CEO, reportedly said the PoC should boost the efficiency, speed, and capacity of the aforementioned services, thereby fostering greater demand.

He added that the benefits of the PoC will not be limited to only Bursa Malaysia customers, stating that the partnership will also benefit 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 the local Bernama news outlet, this is the first such initiative undertaken by a member state of the Association of Southeast Asian Nations (ASEAN).

The PoC has reportedly been developed in collaboration with the stock exchange’s technology partner, Hong Kong-based Forms Syntron Information, with the involvement of Affin Hwang Investment Bank Bhd., CIMB Investment Bank Bhd., Citibank Bhd., Retirement Fund Inc., and Malacca Securities.

Nikhil Rathi, CEO of the London Stock Exchange one of the oldest stock exchanges in the world recently said blockchain technology could be useful in issuing securities and settlement.

Meanwhile, news broke in March that Bolsas y Mercados Españoles (BME), a major Spanish stock market operator, had completed its first blockchain pilot for electronic certificates of collateral pledges.

That pilot, implemented together with investment services firm Renta 4 Banco, aimed to eliminate the use of physical certifications by digitizing all processes while providing networking participants with real-time access to information.


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