The Tel Aviv Stock Exchange (TASE) announced on Tuesday the first-ever launch in Israel of a Central Blockchain Securities Lending Platform, an innovative and groundbreaking financial technology.
This cutting-edge platform, which will officially launch on November 2, 2020, aims to transform the Securities Lending market in Israel by enabling direct lending among all the major financial instruments. The platform will function as a one-stop-shop for all securities lending activities, permitting access to larger securities volumes within shorter timeframes.
To date, there is no central securities lending platform in the Israeli market. Securities Lending is currently executed using inter-bank mechanisms within as well as outside of banking group limits. As a result, the market has not been fully exploited.
"The Tel Aviv Stock Exchange is proud to present this first-of-a-kind lending pool, a safe, cutting-edge and state of the art platform," said Orly Grinfeld, EVP and Head of Clearing at TASE. "The Blockchain technology will present a new level of safety for securities lending and will support growth for transactions based on this new platform."
Grinfeld added that TASE is a "global financial innovation leader" and said it "strategically pursues the technological advancement of the capital market."
According to a press release from TASE, in March 2020, TASE members were given access to an initial testing environment, in order to test lending transactions in the new platform and adapt their systems in preparation for the production phase.
The use of Distributed Ledger Technology (DLT) as the basis of this new trading platform will harness some of the blockchain's primary advantages and features, such as direct peer-to-peer transactions, Smart Contract, and enhanced security through immutability.
All of these are expected to benefit TASE, its custodians and their clients by reducing costs, increasing security and enabling the market to exploit its full potential.