ASX shareholder plans to sue former directors over failed blockchain project
Reported by Cointelegraph · AI-assisted summary by ChikoCorp AI News Desk
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Summary
An ASX shareholder, Rosherville Pty Ltd, plans to seek Federal Court permission to sue certain former ASX officers and directors for alleged breaches of duty related to a failed blockchain-based clearing and settlement project. The proposed statutory derivative action would be brought on behalf of the ASX, though the court has not yet decided whether the case can proceed. The ASX stated there are no allegations against the exchange itself.
Why it matters
The proposed lawsuit could test the ability of shareholders to hold former ASX leaders accountable for oversight of one of Australia’s most expensive financial-technology failures. It follows regulatory actions and court penalties related to the failed CHESS blockchain project, highlighting governance and accountability issues in major exchange infrastructure projects.
Key context
Starting in 2016, ASX aimed to replace its Clearing House Electronic Subregister System (CHESS) using blockchain technology developed with Digital Asset. The project faced repeated delays and was paused in late 2022 after an Accenture review found significant design problems. In May 2023, ASX abandoned blockchain for the replacement system, opting for more conventional technology. ASIC sued ASX in 2024 for misleading the market about project progress, resulting in a $14.4 million penalty and $2.1 million cost order in mid-2026.
Key numbers and entities
The key entities involved are the Australian Securities Exchange (ASX), shareholder Rosherville Pty Ltd, blockchain technology vendor Digital Asset, the Australian Securities and Investments Commission (ASIC), and Accenture as the project reviewer. The Federal Court ordered ASX to pay a $14.4 million penalty and $2.1 million toward ASIC’s costs. The relevant legal provisions are sections 236 and 237 of Australia’s Corporations Act.
What remains unclear
The source does not disclose the names of the former ASX officials targeted, the specific breaches alleged, or the remedies Rosherville seeks. The court has not yet ruled on whether the shareholder’s proposed derivative action will proceed.