South Africa Explores Blockchain to Decentralize Management of Securities

Conflux Network was recently featured as one of the top start-ups with potential of becoming a unicorn by KPMG.

The list included:

• Memsonics
• Stader Labs
• Catheon Gaming
• Maincoin Crypto exchange, and
• Conflux Network

Recently, with the dip in the market, most projects have focused on building scalable infrastructure for the community. Conflux is no exception with it’s ecosystem growing in Africa, Asia and North America.

Conflux Network is the only government-endorsed permissionless blockchain network in China. As a blockchain without barriers, it enables creators, communities, and markets to connect across borders through Web3. 70+ companies leverage Conflux Network’s technology for Web3 services globally.

With more than 4.6 million NFTs issued by companies like CCTV or McDonald’s, Conflux is the leading choice for global players in the Chinese market.

Conflux Network reinitiated it’s Ambassador Program and has over 30 new ambassadors across the market region. The release of the Conflux E-space has seen the community grow exponentially with new projects onboarding on the ecosystem like:

to mention a few.

Recent data shows that over 120 million CFX have been staked by the Conflux community showing high belief in the network by its ecosystem. 

In Africa, Conflux has partnered with a number of reputable ecosystem builders and has become more dominant especially after it’s just concluded event with ChainIDE focused on African developers. The event was a success with over 300 participants and 5 winners emerged. 

Over the years, Conflux has been very active in the African market and has shown it’s continuous support by sponsoring various projects such as TRUST, a Kenyan-based comic, which aims to educate people, especially Africans, about blockchain infrastructure and its use cases. 

Conflux grant program still runs to encourage sustainable projects built on the ecosystem, making it an all inclusive ecosystem with great utility. The African community has also launched its website https://www.cal.confluxnetwork.org/,  which is dedicated to onboarding  African Ambassadors and also educate the ecosystem through numerous publications available on the site.

 If you are looking to contribute to the Conflux ecosystem, either by publishing essential educational material like  tutorials, articles and explainer videos, Kindly signup to be an ambassador on the CALs website. 

(This is a sponsored post)

________________________________________

Follow us on Twitter for the latest posts and updates

Join and interact with our Telegram community

________________________________________

Two senior government officials spearheading research and implementation of financial technologies in South Africa have indicated that the country is exploring using blockchain technology to improve the management of securities.

The two government officials are:

• Lyle Horsley – Divisional Head of the Fintech Unit at the South African Reserve Bank (SARB)
• Gerhard Van Deventer – Senior Fintech Analyst in the Fintech Unit of the South African Reserve Bank (SARB), focusing on financial markets innovation and the impact of distributed ledger technologies on financial markets

In a joint blog post on South Africa’s IFWG (Intergovernmental Fintech Working Group) website, the two officials have indicated that digital ledger technology (blockchain) could trim inefficiencies in the incumbent securities management system. 

South Africa has the most developed financial system in the entire Africa.

The current system relies on a central securities depository (CSD) which acts as a single source of truth for recording and determining ownership of securities. Moreover, intermediaries in the system also have their own databases containing records and ownership information ‘creating a layered network between the issuer and the ultimate beneficiary of the securities.’

Since the CSD is the single source of truth, everyone in the system has to reconcile their databases to march the CSDs, which according to the officials, causes duplication of data, which causes inefficiencies, higher cost, and complexities.

From a landmark project that trialled blockchain and tokenization, government researchers determined that the technology ‘was a new way to transfer value on a P2P basis without a trusted third party, and could allow ownership of securities to be reflected on a single shared ledger accessible, across multiple nodes.’

[THREAD]
Meet Lyle Horsley – Head of SARB's Fintech Unit. She will be explaining the recently launched Project Khokha2, completed in collaboration with @FintechHubSA pic.twitter.com/2Azh2UcEH9

— SA Reserve Bank (@SAReserveBank) April 14, 2022

The researchers highlighted several benefits accruing from their trials of blockchain and tokenization in the South African banking sector:

• Greater efficiencies
• Enhanced price transparency
• Reduction in settlement times
• Greater access to data for regulators depending on the network design

They singled out tokenization as one way to improve trading and enable real-time settlement of securities.

Tokenisation represents a different way for securities, money and other forms of value to be represented, exchanged and recorded, moving from a master copy of the truth held by a single entity and duplicated by other roles players, to a distributed ledger accessed by various role players. – IFWG

Since 2018, the South Africa Reserve Bank has been spearheading a project to research potential use cases for blockchain technology in the financial system. Dubbed Project Khokha:

• Project Khokha, Phase 1, investigated how a wholesale CBDC (central Bank Digital Currency) could be used for inter-bank payments and settlements. The project proved that it was possible to replicate some of the functions of South Africa’s real-time gross settlement system at scale and speed using a standard messaging format, while maintaining confidentiality and privacy and providing visibility for both operational management and oversight

• Project Khokha 2, was launched in February 2021 and involved the creation of two forms of tokenized money to allow for settlement between financial institutions. This phase showed that distributed ledger technologies (DLT) can allow for the ownership of securities to be reflected on a single shared ledger accessible, across multiple nodes, which may hold various benefits, including greater efficiencies; enhanced price transparency; reduction in settlement times; and greater access to data for regulators depending on the network design

A further important consideration in the exploration of DLT in the securities trade life cycle is how the two legs of the sale of securities:

• The delivery leg that transfers the security, and
• The payments leg that transfers the cash

can be settled on DLT.

Tokenisation represents a different way for securities, money and other forms of value to be represented, exchanged and recorded, moving from a master copy of the truth held by a single entity and duplicated by other roles players, to a distributed ledger accessed by various role players.

________________________________________

Follow us on Twitter for the latest posts and updates

Join and interact with our Telegram community

________________________________________