Nigerian stock exchange NGX plans to integrate blockchain by 2023 to attract investors interested in this technology and digital assets.
The NGX Exchange is considered Africa’s leading exchange for stocks, mutual and other investment funds, and fixed rate bonds. NGX CEO Temi Popoola informedthat by 2023 the exchange can use the blockchain to conduct transactions in the stock market. This will eliminate counterparty transaction risks, as well as increase the security and speed of settlements, so it is necessary to choose a highly scalable blockchain, Popula said.
He plans to explore other uses for the technology. The head of NGX believes that in addition to security and speed, the blockchain will attract a younger generation of investors to the exchange, who are increasingly interested in the digital asset market for portfolio diversification.
“Blockchain can make it easier to create products and exchange financial assets on an exchange. In addition, we want to analyze how blockchain can be used to expand our market,” said NGX CEO.
However, Stears analyst Gbemisola Alonge believes that the implementation of blockchain in NGX operations will not be so smooth, since for many regulators this technology is inextricably linked with cryptocurrencies. The Nigerian Central Bank and local government are wary of digital assets, so investors may be skeptical about the NGX initiative.
Earlier, the Australian Stock Exchange (ASX) also announced its readiness to modernize its clearing and settlement system through the transition to the blockchain. However, last year Judith Fox, CEO of the Association of Stockbrokers and Financial Advisers of Australia, said that the transition to the blockchain is associated with large costs that will cost millions of dollars.
Source: Bits
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