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ASX Shareholder Seeks Court Approval to Sue Former Directors Over Failed Blockchain Overhaul
- Rosherville is seeking court permission to pursue former ASX officials over alleged breaches connected to the failed CHESS replacement.
- The blockchain project was paused in November 2022 and abandoned in May 2023 after an Accenture review identified significant problems.
- ASX later faced ASIC enforcement, admitted misleading conduct and was ordered to pay A$16.5 million in penalties and costs.
An ASX shareholder plans to ask the Federal Court for permission to launch a statutory derivative action against former directors and officers over alleged breaches of duty linked to the exchange’s abandoned blockchain-based CHESS replacement.
Rosherville Pty Ltd has notified ASX that it intends to seek leave under sections 236 and 237 of the Corporations Act to bring proceedings on the exchange’s behalf. A statutory derivative action allows an eligible shareholder or officer to pursue proceedings for a company when the company itself is unlikely to do so, with court approval required before the case can proceed.
ASX said the allegations are directed at former officials rather than the exchange itself, while the identities of those targeted, details of the alleged breaches and proposed remedies have not been disclosed.
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CHESS Overhaul Under Scrutiny
The proposed case follows the collapse of ASX’s long-running effort to replace its Clearing House Electronic Subregister System with distributed-ledger technology. ASX began examining a CHESS replacement in 2016 and selected technology developed with New York-based Digital Asset, with the project initially expected to make ASX the first securities exchange to use blockchain for core services.
The planned launch was repeatedly delayed before ASX paused the project in November 2022 following an independent Accenture review that identified significant problems with its design and delivery. ASX formally abandoned the blockchain approach in May 2023 and moved towards considering conventional technology for the replacement.
ASIC later sued ASX over statements made about the project’s progress, while ASX admitted misleading conduct in June 2026. On 3 July, the Federal Court ordered ASX to pay a US$14.4 million (AU$20.45 million) penalty and US$2.1 million (AU$2.98 million) towards ASIC’s costs.
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Author
Rachel Lourdesamy
Rachel is a freelance writer based in Sydney with experience within financial services, marketing, and corporate communications in the APAC region. An avid reader and a graduate of the University of Sydney, she covers topics including business, finance and human interest.
