ZAR X to offer unit trusts on blockchain with Adhara and Computershare South Africa
ZAR X CEO Etienne Nel says blockchain technology likely the future of financial markets settlements.
Relatively new South African stock exchange ZAR X announced that they have launched the first distributed settlement system in South Africa for unit trusts in conjunction with Adhara and Computershare South Africa.
According to a statement, the system uses blockchain technology to enable the public to purchase and settle unit trusts directly from fund managers in a secure environment. Instead of monthly administration fees, investors pay a once-off transaction fee. They can also transact in unit trusts, either through their ZAR X broker or on any mobile device using the ZAR X Mobi App.
The statement further read that the system provides regulators and investors with full transparency and transaction history in real-time. As the blockchain serves as a ledger of events that are distributed or shared between different parties, it can only be updated by consensus of the participants in the system. This effectively means the blockchain provides a single version of the truth and eliminates the need for reconciliations.
ZAR X CEO Etienne Nel said that since its inception, ZAR X has pioneered technology and introduced innovative products and services to capital markets in the country. “We have prioritised cost education in both the listing process and for investors. To this end, we are driving even more efficiencies by offering unit trusts on the blockchain which is likely to be the future of financial markets settlement,” he said.
The Adhara components allow for the unit trusts and cash to be tokenised on the same ledger. This ensures all transactions occur ‘on-chain’, providing real-time Delivery vs Payment (DvP) settlement.
Adhara COO and co-founder Peter Munnings said:
“We are delighted to be part of this production-grade blockchain solution to go live internationally. Adhara has used its Token+ product for this solution that is built on Hyperledger Besu (an open-source, enterprise-grade Ethereum client).”
“This is an exciting initiative, and we are pleased ZAR X has appointed Computershare as the nominee administrator for the first distributed ledger settlement system for unit trusts. We have a proud track record of using robust technology and infrastructure to support the diverse and unique requirements of each of our clients,” added Computershare South Africa CEO Bennie van der Westhuizen.
The project will go live in the last quarter of this year and will be available via the ZAR X Web site and the ZAR X Mobi App available in Apple iOS and Android app stores.