Tel Aviv Exchange Plans Blockchain Based Securities Lending Platform

The Israel financial market lacks a reputed securities lending platform. Traditionally, lending is carried out using inter-bank mechanisms and faces a lot of constraints. To fill the void, the Tel Aviv Stock Exchange (TASE) has partnered with Accenture to create a blockchain technology based securities lending (BSL) platform that will facilitate lending of securities. To achieve the objective, the partner duo is also working with Intel and The Floor, a local fintech company.

The project was conceived at a blockchain hackathon in March 2017. The parties intend to take the project forward by initially demonstrating a proof-of-concept. Later, the parties intend a live deployment on the Hyperledger Sawtooth platform, which offers increased security at lower costs. Intel’s hardware-based Software Guard Extensions security (Intel SGX) technology will be used to encrypt transaction data.

The press release states the BSL will carve itself as a “one-stop-shop for all securities lending activities, permitting access to larger securities volumes within shorter time-frames, even operating in shorter-term positions.”

For building the Securities Lending platform, Accenture will provide systems integration, blockchain and cybersecurity consulting services, and overall project management. The company will also play a major role in the creation of smart contracts for the platform.

By using Distributed Ledger Technology, the project aims to provide all the advantages of a blockchain ecosystem, such as P2P transactions, smart contracts, immutability, and enhanced security. The clients, TASE, and its custodians will be able to make an optimum use of the platform at lower costs.

TASE CEO Ittai Ben-Zeev said,

“The Tel Aviv Stock exchange is pleased to present this first of a kind project. A safe, cutting-edge, state of the art platform, that was created thanks to a great collaboration among The Floor, Intel and Accenture. The Blockchain technology will present a new level of safety for securities lending and will support growth for transactions based on this new platform. Without a doubt, TASE is now, more than ever before, a global financial innovation leader.”