Hg Exchange announced that it seeks to launch Southeast Asia’s first member-driven exchange to support the issuance and trading of private company shares, including security tokens. The exchange represents a collaborative industry effort between established capital markets intermediaries and emerging innovators from the fintech sector. It has signed a memorandum of intent with Phillip Securities, PrimePartners, RHT Capital and Fundnel, which thereafter will become the first four members of the exchange.
Hg Exchange has submitted a FinTech Regulatory Sandbox application to the Monetary Authority of Singapore (MAS). The industry-backed effort promotes transparency by sharing transaction data amongst market makers and private companies, creating efficiencies for the general market. For investors, this brings unparalleled access to invest into high-growth companies such as Airbnb, Deliveroo, Didi Chuxing, GoJek, Grab, Pinterest, SpaceX and Uber. Hg Exchange solves the perennial problem many shareholders of private companies face by presenting a single destination to help monetise their stake.
Powered by MaiCoin and Zilliqa, Hg Exchange will bring together cutting-edge technology and far-reaching solutions, with the blockchain layer enabling ease of trading and settlement, and the potential to verifiably secure stored assets. With its main net launch imminent, Zilliqa employs sharding as an on-chain solution to preserve decentralisation and enable scalability. Its proprietary smart contract language is amenable to formal verification, thus providing enhanced security for assets. Taiwan’s largest and longest running digital asset platform, MaiCoin will be responsible for building the exchange functions from the matching engine to the order book. With a reputation as one of the most secure exchanges, MaiCoin will provide a secure and intuitive front end.
“The distinctive structure of the member-driven exchange, places Hg Exchange in a prime position to offer new opportunities for our investors, and a chance to participate alongside institutional investors,” said Mr Luke Lim, Managing Director of Phillip Securities.
“Private exchanges are a natural complement to Singapore’s financial ecosystem attracting innovative tech companies and connecting investors to new opportunities. We believe that Hg Exchange will add vibrancy and depth to Singapore’s equity capital markets,” said Mr Mark Liew, Chief Operating Officer of PrimePartners.
“As more people want access to investment opportunities in disruptive technologies, Security Token Offerings (STO) are emerging as an alternative to Initial Public Offerings and public market exchanges. Hg Exchange will offer the listing and trading of security tokens, creating new efficiencies in speed and cost as well as new liquidity, unlocking value in a wide variety of existing assets,” said Mr Jayaprakash Jagateesan, Chief Executive Officer of RHT Holdings.
Kelvin Lee, co-founder and CEO of Fundnel, also believes that private exchanges such as Hg Exchange is a crucial step towards invigoration of the local investment scene, attracting global companies and financial talent into the region.
Hg Exchange is envisioned to replicate the success of existing private exchanges such as the Nasdaq Private Market, which set a new record in transaction volume in the first half of 2018, which saw deal volume growing by 74% and exceeding SGD14 billion (USD10 billion) for the first time.
Hg Exchange will be accessible only to institutional and accredited investors and will operate on a membership only basis for licensed or registered market participants.