The Role of Blockchain and Smart Contracts in Modernizing the Johannesburg Stock Exchange: Implications for Transparency, Cost Reduction and Investor Protection

Abstract

The rapid advancement of blockchain technology and smart contracts presents significant opportunities to transform financial markets globally. This study investigates the role of blockchain-enabled trading platforms and smart contracts in modernizing the Johannesburg Stock Exchange (JSE), with a focus on market transparency, transaction cost efficiency, and investor protection. By integrating a mixed-methods approach, combining qualitative insights from industry experts with quantitative analyses of trading data, the research examines how distributed ledger technology can enhance the accuracy, speed, and security of financial transactions. The findings indicate that block-chain adoption has the potential to reduce operational and transaction costs, improve the transparency of trade processes, and strengthen safeguards for investors, thereby fostering greater confidence and participation in South African capital markets. The study also highlights regulatory, technological, and infrastructural challenges that may impede full implementation, offering actionable recommendations for policymakers, financial institutions, and market participants. Overall, the research underscores the transformative potential of block-chain and smart contracts as strategic tools for enhancing efficiency, accountability, and trust in the JSE, positioning South Africa to leverage emerging financial technologies for sustainable capital market development.