Singapore-based ADDX security token exchange is off to a flying start
The ingredients of a successful security token exchange are now clear. It must be regulated, focused on asset classes that will benefit from greater liquidity and secondary market trading, and be backed by strong, committed and widely recognised shareholders that are willing to engage actively in helping the exchange to succeed. ADDX, the security token exchange regulated by the Monetary Authority of Singapore (MAS), meets these criteria in full. Armed from 2020 with no less than three regulatory licences spanning securities, funds and a trading platform, and capitalised by a combination of the SGX, Temasek and major financial institutions from Japan, Korea and Thailand, ADDX is concentrating initially on the less than liquid privately managed assets whose liquidity tokenisation is best-placed to transform quickly. Security token exchanges need issuers and investors, and last year saw ADDX gather both. A string of issues backed by its shareholders garnered support from exactly the class of wealthier retail investors looking to diversify into asset classes previously reserved for institutions. A novel distribution agreement was also put in place in Japan. Dominic Hobson, co-founder of Future of Finance, spoke to Oi-Yee Choo, chief commercial officer at ADDX, about where ADDX has come from and where it plans to go next.