Hong Kong Exchange Launches Synapse Platform to Streamline Equity Settlements

Hong Kong Exchange and Clearing Limited (HKEK), a publicly traded holding company, has announced on October 5, 2023, its Synapse platform, a centralized ecosystem aimed at making the process of settling equities more straightforward.

The platform is set to debut in Hong Kong on October 9, with the goal of improving Hong Kong’s position in the financial industry.

According to report, the platform will use smart contracts, specifically programmed in DAML (Digital Asset Modelling Language), to improve the way post-trade activities are handled.

Synapse will be incorporated into HKEX’s Stock Connect, allowing international investors to access more than 1,000 mainland Chinese Stocks through Hong Kong.

HKEX Group Head of Emerging Business and FIC, Glenda So, emphasized that synapse will not only increase efficiency in post-trade activities but also contribute to creating a market environment that supports the growth of both the markets and investors.

According to him:

“We are very proud to be introducing Synapse to our market and we look forward to continuing to embrace new technologies that benefit our markets and our customers in the future.”

HKEX has reported solid performance in its stock Connect platform, with daily turnover reaching RMB 109.3 billion in the first half of 2023, marking a 5% increase compared to the previous year and a significant 50% growth from 2020.

Additionally, HKEX plans to integrate Synapse with the Depository Trust & Clearing Corporation (DTCC) in Hong Kong.

This connection will centralize cross-border transaction matching and automate settlement instructions, making trade confirmations and notifications easier for global investors and HKEX stakeholders.

Despite the positive developments, Hong Kong faces challenges as it recently experienced a scam attack related to the JPEX cryptocurrency exchange. The attack resulted in a loss of $166 million

Although there are still investigations going on, Analysts have expressed their concern about the negative impact it can have on Hong Kong’s Digital asset industry.

However, HKEX remains dedicated to advancing technology advancement solutions for its markets and stakeholders.