The Singapore stock exchange has collaborated with the country’s central bank, Monetary Authority of Singapore (MAS) to make the securities settlements more efficient by availing the blockchain technology.

The Singapore Exchange (SGX) sent out a press release on Friday which stated that this joining of hands by the SGX and MAS was carried out with the intention to meet the goal of multiplying Singapore’s Delivery versus Payment (DvP) capacity to enable it to automate transactions via blockchain-based smart contracts. The system under discussion, DvP refers to a process that ensures that the transactions only take place when the payment against the asset is received.

This partnership has received support from various organizations in various forms such as Nasdaq in the technological department and Deloitte rendered its professional services, with the blockchain set-up Anquan also making it to the announcement by SGX.

The primary objective of this collaboration is to set up a distributed network where financial institutions and stakeholders can perform transactions on securities that have been converted into digital tokens through various blockchain platforms.

Both the collaborators stated that the technology will be constructed around the open source code which came as a result of Project Ubin, an initiative by the MSA in 2016 and which settled interbank transactions via distributed ledger technology.

According to the press release, an in-depth analysis of the key design considerations will be issued by November.

The project in-charge and technology chief for SGX, Tinku Gupta mentioned in her statement:

“This initiative will deploy blockchain technology to efficiently link up funds transfer and securities transfer, eliminating both buyers’ and sellers’ risk in the DvP process.”

Looking at this from a global perspective, the SGX is not the only one turning towards blockchain for quicker securities liquidations. Along with SGX, the Australia Securities Exchange is also following SGX’s footsteps and aims to reach its destination by 2020 with the help of the blockchain startup, Digital Asset Holdings.