Private market exchange ADDX will now consider digital assets in verifying accredited investors, making it the first institution to do so in Singapore.
Singapore’s ADDX Announces It Will Consider Crypto Assets in Determining the Eligibility for Private Market Investments
Before this development, only traditional assets, such as bonds, stocks, cash, and real estate, could be used for a person to get access to complex investment options in private markets. While crypto assets are not recognized as financial assets, they can be classified under the third category of net personal assets.
For now, ADDX recognizes three digital assets with high market capitalization, including USD Coin, Ether, and Bitcoin. When calculating the value of investments, ADDX will apply the 50% discount rate for Ether and Bitcoin holders. However, USD Coin holding will attract a 10% discount. ADDX said that the coins and discounts are subject to regular reviews depending on the market conditions.
Important Facts about ADDX accepting cryptos:
- ADDX’s move indicates the crypto status as an asset class is now getting into the mainstream.
- It will now pave the way for more people to get qualified as “accredited investors,” according to the Monetary Authority of Singapore (MAS).
- The regulator will only allow high net individuals to buy the “sophisticated investment products” via the private market. People will be required to provide documents to prove that the value of their net personal assets reaches the S$2 million threshold.
“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,” ADDX CEO Oi-Yee Choo explained.