Nasdaq Pulls in Chain for Private Markets Ledger Pilot

Specialist technology provider Chain has been tapped to help Nasdaq launch its Open Asset Protocol initiative for pre-IPO private markets trading.

nasdaq-ice-ceos
Robert Greifeld, Nasdaq (left).

Specialist technology provider Chain has been tapped to help Nasdaq launch its Open Asset Protocol initiative for pre-IPO private markets trading.

The vendor is now the first officially signed to use the blockchain-based technology on Nasdaq Private Market, which will begin in late 2015, while more work with distributed ledgers is expected at the exchange operator after Open Asset was announced earlier this year and Frederick Voss was appointed to spearhead enterprise-level projects around them.

By using the blockchain to represent securities and manage capitalization tables before public offering, stockholders can seamlessly transfer securities between entities, and companies and their affiliates can be provided with a complete historical record of issuance and transfer of their securities. Integrity, audit ability, issuance governance and transfer of ownership capabilities are also advantages, Nasdaq said in a statement.

The project joins a number of initiatives around the industry around the applicability of blockchain and new digital currencies products, which Waters covered in-depth in the May issue.

"This Nasdaq Private Market project aims to simplify the overwhelming challenges private companies face with manual ledger record-keeping, and we are excited about the potential impact of this new endeavor with Chain on the transaction process," said Nasdaq CEO Bob Greifeld. "As blockchain technology continues to redefine not only how the exchange sector operates, but the global financial economy as a whole, Nasdaq aims to be at the center of this watershed development."

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