Blockchain Technology Will Be Use For Voting Soon

The Ultimate Power Group – SWIFT Partners Up With Major Banks While SGX Begins Trials On Blockchain-Backed Voting.

According to SWIFT, the financial messaging juggernaut, it has officially partnered up with a range of banks across the world, as well as the Singapore Stock Exchange in order to create and subsequently test out a blockchain-based platform dedicated to the creation of an e-voting system, the company reported this week.

Banding together in order to find out whether DLT (Distributed Ledger Technology) can work to provide a more transparent, yet secure system of voting for shareholders within companies regardless of their size. Among those banks that are working in collaboration with SWIFT and the Singapore Exchange are DBS, Deutsche Bank, HSBC, and Standard Chartered Bank. Among those working within this group include SLIB, the securities software company.

There are plenty of aspects when it comes to the process of having shareholders called to vote on a company action that becomes cumbersome incredibly quickly. The biggest example of this is the fact that the current paper-based approach towards voting in a major company is rendered ‘time-consuming and resource-intensive,’ according to SWIFT.

The company goes on to elaborate on why the application of Distributed Ledger Technology in this field has all of the potential to not only address, but thoroughly streamline this limitation, the company explains:

“Proxy voting, in particular, frequently results in error-prone and complex manual processes, which the industry can avoid by fostering greater transparency and automation.”

The trial itself makes use of a Proof of Concept (PoC) Consensus algorithm and intends to stress-test the proposed voting solution, which actively engages issuers as well as a Central Securities Depository, which allows for data to be processed and subsequently stored via a private blockchain.

From here, those companies involved in the partnership will also be working towards assessing potential for a hybrid solution that allows for a merging of financial messaging solutions in accordance with the patented ISO 20022, allowing it to work with a Distributed Ledger Technology in order to greatly improve interoperability while also avoiding what the company referred to as ‘market fragmentation,’ according to the company’s announcement.

For these collective efforts, the likes of Deutsche Bank, HSBC, as well as Standard Chartered will be serving as the participants for these series of tests. Meanwhile, DBS and the Singapore Exchange will be serving as both participants within this test, as well as some of its issuers.

Even though these clear lines have been drawn for how these firms will be participating in the test, it remains unclear from this announcement in particular, which CSD will be working to support the Proof of Concept system.

Importantly, SWIFT will be operating as the host of this trial, conducting it within a sandbox style testing environment, allowing the partners to apply and make use of the SWIFT network, as well as it’s current operational infrastructure and interface systems as they continue to test these technologies further.

One of the further elements of this trial will revolve around a deeper examination of SWIFT’s own capacity to provide its services in a hosting capacity within its sandbox style environment, allowing the firm to re-use its security methods and interface for other required purposes.

Speaking on behalf of the firm as the group head of Securities and Fiduciary Services within DBS, Soh Ee Fong went on to state:

“An innovative and seamless e-Voting platform in this industry is long overdue and DBS is pleased to join SWIFT in the PoC as both issuer and participant. … With this solution, shareholder meetings will not be the same again.”

Over the course of 2017, SWIFT worked to assist a consortium which was backed by a collaboration of CSDs, working on a plan to develop a very similar kind of Distributed Ledger Proxy-style voting system which targetted a similar kind of clientele.

This project was also aimed at providing a communications solution that would prove capable of adhering to the stringent ISO 20022 standard, in an attempt to allow for voting systems to be applied across a far greater scope of services than previously believed possible.


 

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