ADDX is first Singapore financial institution to recognise crypto assets of accredited investors


Private market exchange ADDX has become the first financial institution in Singapore to recognise cryptocurrency assets for the purposes of onboarding accredited investors. ADDX can onboard such investors from all over the world. Under Monetary Authority of Singapore (MAS) regulations, only accredited investors have access to more sophisticated investment products in the private markets.  

 

Key points: 

• ADDX's move signals crypto’s status as an asset class in the mainstream. 

◦ It also paves the way for more individuals to qualify for accredited investor status. They can thereby participate in more sophisticated investment opportunities in the private markets, which tend to be more resilient in times of market volatility. 

• Under Singapore’s regulatory regime, individuals have to meet any one of three criteria in order to qualify as accredited investors: 

◦ Annual income exceeds SGD 300,000, OR 

◦ Net financial assets exceed SGD 1 million, OR 

◦ Net personal assets exceed SGD 2 million 

▪ Before this, only traditional assets like stocks, bonds, cash and real estate could be used for an individual to become verified as an accredited investor  

▪ While crypto assets are not currently recognised as income or financial assets, they can be recognised under the third category of net personal assets – with ADDX being the first to do so. 

• In line with regulations, ADDX will implement appropriate risk management measures that take into account the price volatility of crypto assets. For example, ADDX will recognise only cryptocurrencies with a higher market capitalisation and will apply a discount rate when valuing the assets. 

• ADDX CEO Oi-Yee Choo said: “Cryptocurrencies are here to stay. They no longer exist only on the fringes of wealth and investment conversations. With a large minority of investors owning crypto, it is reasonable for these digital assets to be recognised as a part of one’s portfolio – not unlike any other assets that can be valued in the marketplace, such as real estate or equity. Investors increasingly expect a seamless view of their complete holdings because their traditional wealth and crypto wealth ultimately belong to a single portfolio. They want the best of both worlds. At a time when the markets are volatile, this move is also designed to enable crypto investors to diversify into the regulated private markets, which tend to be more stable across different phases of market cycles.” 

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