Singapore’s DBS Digital Exchange: Serving the rich cannot escape the law of true fragrance

The dust settled!

On December 10, Singapore’s DBS Bank officially announced the launch of the digital asset trading platform DBS Digital Exchange, which will start trading next week. According to DBS CEO Piyush Gupta, DBS Digital Exchange will provide exchanges between four legal currencies (Singapore dollar, US dollar, Hong Kong dollar, Japanese yen) and the four most mature digital assets (BTC, ETH, BCH and XRP) Services, spot trading services and custody services.

In addition to being able to trade cryptocurrencies, what else does DBS Digital Exchange have?

Not only trading cryptocurrencies

Not only trading Bitcoin and other four cryptocurrencies, the ambition of DBS Digital Exchange is to use blockchain technology to provide an ecosystem for fundraising through asset tokenization and secondary trading of digital assets , including:

  • Securities Token Offering (STO)-a regulated platform for the issuance and trading of digital tokens backed by financial assets, such as stocks, bonds and private equity funds of unlisted companies.
  • Digital currency exchange-promote spot trading from legal currency to encrypted currency. DBS Digital Exchange will provide trading services between four currencies (Singapore dollar, US dollar, Hong Kong dollar, Japanese yen) and the four most mature cryptocurrencies (ie BTC, ETH, BCH and XRP).
  • Digital asset custody service-an institution-level digital custody solution to meet the growing demand for digital asset safe custody services under current regulatory standards.

Currently, the Monetary Authority of Singapore has approved in principle the recognition of DBS Digital Exchange as a recognized market operator, allowing it to operate an organized market for assets such as stocks, bonds and private equity funds.

In other words, in the future, once the STO business becomes formal, DBS Digital Exchange will also become a small financial asset trading platform.

Second, the one business that should not be overlooked is the hosting business.

According to Singaporean banking practitioners, DBS’s main competitor in Singapore, UOB, is also stepping up the development of digital asset custody solutions and has begun to recruit a large number of relevant personnel.

From a global perspective, cryptocurrency custody services have now become a virgin land for major banks to compete for.

In July 2020, the Office of the Comptroller of the Currency (OCC), which is responsible for overseeing the Federally Chartered Banks of the United States, announced that banks within its jurisdiction are now approved to provide cryptocurrency custody services.

In August, South Korea’s two large commercial banks Woori Bank and Shinhan Bank stated that they are currently discussing the possibility of introducing cryptocurrency services. South Korea’s NH Nonghyup Bank also stated that it is currently cooperating with the blockchain research institute Hexlant to introduce encryption. Currency custody service.

In December, Standard Chartered Ventures, the innovation and venture capital arm of Standard Chartered Bank, and Northern Trust jointly released an institution-level encrypted digital currency custody solution-Zodia Custody (hereinafter referred to as “Zodia”).

On the whole, cryptocurrency custody will become a key infrastructure of the cryptocurrency market, and a regulated custody institution can become a bridge connecting the cryptocurrency market with the government and traditional funds.

Membership exchange

In particular, the DBS Digital Exchange is a membership-based exchange for institutional investors and qualified investors. It is more straightforward, mainly for high-net-worth customers, and it also reflects that Bitcoin is increasingly being used by the rich. Recognized.

Today, Singapore has become the center of Asian private banking and is considered by many institutions to challenge Switzerland’s global position.

There are two secrets to the rise of Singapore’s private banking business. One is that high-net-worth individuals prefer to keep customer information confidential. The strict implementation of Singapore’s “Bank Secrecy Act” is considered to be an important driving force for Asia’s private banking center; the other is lower tax rates. .

The second is the surrounding environment, making Singapore a haven for wealth.

As the first of the three major banks in Singapore, DBS Bank acquired Societe Generale’s private banking business in Hong Kong and Singapore in 2014, and holds a large number of high-net-worth clients.

The report shows that in the first half of the year, DBS Private Bank’s net new capital inflows surged by 170%, while assets under management (AUM) increased by 9% during the same period.

When these high-net-worth clients have the need to invest in cryptocurrency, then meeting their needs becomes an opportunity for DBS.

In the official statement, DBS mentioned that “the investor base and distribution network established through DBS Private Bank and DBS Vickers Online Securities enables DBS Digital Exchange to utilize a large number of potential investors.”

Therefore, for DBS Digital Exchange, there is no shortage of customers.

In addition, from financial data, due to the impact of the epidemic, DBS’s net profit in the second quarter fell by 22% year-on-year, mainly due to loan losses. Therefore, DBS is also actively looking for new profit growth points.

In the month when the financial report was released, DBS Bank also released an in-depth report on “Digital Currency: Public and Private, Current and Future Currency” . The 30-page report describes the growing demand for crypto assets and their advantages in the digital world. .

In the report, the main conclusions drawn by DBS Bank are:

  • Digital payment and settlement have existed for a long time, and private digital currency has a history of more than ten years, but 2020 will become a milestone in the history of digital finance.
  • New technical areas of personal payment and settlement are opening up. The surge in private digital currencies has had a profound impact on the supply of money and the store of value.
  • For more than half a century, the central bank has been creating money through digital means, and is now plagued by the innovation and expansion of financial technology.
  • Although the standards, regulations, and acceptance of digital currencies in the private sector have not yet been fully determined, they have found appeal.
  • Cryptocurrencies will continue to exist, and cash and traditional financial forms will not be eliminated anytime soon.

It seems that DBS Bank is well prepared.

On November 15, 2017, Singapore’s DBS Bank (DBS), one of Asia’s largest banks, believed that David Gledhill, the global chief information officer and head of group technology and operations, told CNBC: “We believe that Coin is a bit like a Ponzi scheme.”

On the sidelines of the Singapore Fintech Festival, he stated that bitcoin transactions are “incredibly expensive” and “all fees are hidden through encryption. We don’t think that DBS participation in this game will create a competitive advantage for us.”

Gladhill said it makes more sense for the bank to focus on electronic transactions in government-backed currencies. He expected the final price of Bitcoin will become “very cheap, because it is limited by its size” .

DBS Bank is the largest bank in Southeast Asia and a believer in emerging technologies. Earlier this year, the bank announced the launch of an e-learning management system based on cloud computing.

However, Gladhill said that Bitcoin will not help the bank attract customers, deposits or wealth management business, so the bank’s current attitude is “wait and see and learn.”

Bitcoin is so fragrant!

Source : Golden Finance


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