The Australian Securities and Investments Commission (ASIC) has established a panel of experts to investigate the internal operations of the Australian Securities Exchange (ASX) following a series of failures, including a $250 million (USD) blockchain project that collapsed after seven years of development.
Purpose and composition of the panel
ASIC announced on Wednesday that three board members will focus on investigating the governance, capabilities, and risk management of the ASX Group. The board will review organizational and cultural factors that led to recent compliance incidents, assess ASX's ability to maintain a stable market infrastructure, and consider financial objectives as well as accountability frameworks.
Rob Whitfield, former CEO of Westpac Bank, will chair the panel. Joining him are Christine Holman and Guy Debelle.
Consequences from the failed Blockchain project
The investigation follows the disastrous failure of ASX's blockchain-based CHESS replacement project. Launched in 2016 to modernize the clearing and settlement system, the project was canceled in November 2022 after years of delays and cost overruns. An independent audit indicated "significant design challenges," leading ASX to record a pre-tax loss of $170 million and ultimately abandon blockchain technology entirely in May 2023.
The collapse of the project led to ASIC suing ASX in August last year for allegedly making misleading statements about its progress. ASX was also fined $1,050,000 in March for other compliance issues.
Kadan Stadelmann of Komodo Platform noted that ASX's failures have "eroded investor confidence" and highlighted the risks of over-promising on enterprise blockchain initiatives.
The panel is expected to make recommendations before March 31, 2026, and ASIC will publish a report that could lead to legal action against ASX.
