Recent News

Singapore Startup BondEvalue Partners with Northern Trust to Deliver Digital Solutions For Its Blockchain-Powered Bond Exchange Platform

15/11/2019 – Singapore-based tech startup BondEvalue has agreed to partner with Northern Trust, a Chicago-headquartered financial services company, for the American firm to support its nascent blockchain-powered bond exchange platform, BondbloX. Besides providing digital solutions for the tech startup, Northern Trust will also offer asset servicing solutions for its platform, which BondEvalue claims is the world’s first ever blockchain-based bond exchange where bonds can be traded digitally in denominations of US$1,000.

The tech startup’s innovative platform is the first in the bond space to be approved by the Monetary Authority of Singapore (MAS) to operate in its regulatory sandbox, Sandbox Express, which offers companies and organizations a quicker, streamlined option for trialing their groundbreaking financial services and products in a pre-defined market environment. According to Sopnendu Mohanty, who is chief fintech officer at MAS, Sandbox Express is able to help innovative companies collect data – which they need to calibrate and adapt their products or services to suit the market – from clients and customers in a timely manner by granting them access to a streamlined approval process that allows for faster testing in the market.

To BondEvalue, the present-day, prevalent method of trading over the counter for bonds via brokerages and securities firms is ripe for disruption. The current way of trading bonds does not encourage transparency and is not as efficient or cost-effective as it should be. Sensing an opportunity to transform the bond trading process for the better while opening the market to an even larger pool of potential investors, the Singapore-based startup proceeded with its revolutionary BondbloX bond exchange platform.

By pioneering a blockchain-based electronic bond exchange built on Hyperledger Sawtooth, BondbloX is able to achieve so much more than what the current bond trading market can do. For one, as trade settlements are now conducted electronically, it can shorten the conventional two-day trade settlement cycle to just a matter of seconds. Additionally, its blockchain feature enables bonds to be traded in much the same way as stocks, while transplanting the bond trading process to a digital exchange platform encourages price transparency and promotes fairness.

One of the most promising features of the blockchain-powered bond exchange, however, may be its “fractionalization” capability. Rahul Banerjee, BondEvalue’s founder, says that presently due to the US$200,000 investment requirement, only a miniscule number of people in Asia are actually able to purchase wholesale bonds. He believes that this should not be the case, and that the bond market should be made accessible to all people irrespective of their wealth. With “fractionalization”, BondbloX provides a unique feature whereby it can take any US$200,000 or equivalent bond in the secondary market and change it into more affordable denominated BondbloX (fractional bonds) of US$1,000. In fact, Rahul intends for his digital bond exchange to grow the number of bond market investors to over 25 million in just under half a decade.

In order to reach out to more potential users, BondbloX is connected to robo advisors, banking institutions and wealth managers around the globe, thus permitting their customers to trade BondbloX. Here, Northern Trust will be the blockchain-based bond exchange’s sole asset servicing provider.

According to Justin Chapman, Northern Trust’s global head of market advocacy and innovation research, the support the company provides for the Singapore tech startup has the capacity to open up the bond market to a much wider pool of investors, which hitherto is accessible only to large institutions. Rahul added that the startup is very pleased to have Northern Trust on board as a partner and is looking forward to their cooperation.

BondEvalue looks to disrupt the bond market with its blockchain-powered bond exchange BondbloX. With the support of Northern Trust and MAS, the future looks bright for the Singapore startup as it pursues its goal of making the bond market more accessible to the general populace with its innovative blockchain platform.

Malaysia’s Stock Exchange Completes Southeast Asia’s First Securities Lending Blockchain PoC

11/11/2019 – As part of the country’s revolutionary overhaul of its lending market, Malaysia’s stock exchange announced that it has just completed the Association of Southeast Asian Nations (ASEAN) region’s first of its kind proof-of-concept (PoC) for its blockchain-powered securities lending solution, with the aim of improving and increasing the speed, efficiency and capacity of its lending pool. Bursa Malaysia, Malaysia’s stock exchange, conducted the collaborative effort with Malaysian investment bank Affin Hwang Investment Bank, Citigroup’s Malaysian subsidiary Citibank Berhad, Malaysian pension fund Kumpulan Wang Persararan, brokerage firm Malacca Securities and Singapore-headquartered CGS-CIMB Securities, while Hong Kong-based Forms Syntron Information, which is a subsidiary of Shenzhen Forms Syntron Information, acted as the technology partner that tested and carried out the proof-of-concept.

Bursa Malaysia’s securities borrowing and lending proof-of-concept, or SBL POC 1, was executed using an agile methodology consisting of vigorous design thinking, development and testing stages. The proof-of-concept was a successful test of a private-permissioned blockchain-driven SBL lending pool that can create increased efficiencies, intensify market discovery and build transparency and trust. Bursa Malaysia further noted that its securities borrowing and lending proof-of-concept has secure, shared ledgers and smart contracts which enable instant, automated update of asset status.

According to Bursa Malaysia, it chose blockchain to power its securities lending solution because of the many benefits afforded by the emerging technology. Bursa Malaysia, in a statement, said: “Information stored in the ledger, like records of trade negotiations and order confirmations, are immutable, auditable and traceable. It avoids the need for manual reconciliation, which may introduce errors due to disparate methods of trade negotiation and order confirmation recording.”

Datuk Muhamad Umar Swift, chief executive officer of Bursa Malaysia, said: “Evidence shows that a vibrant SBL market is one of the key characteristics of a developed capital market. As such, it is imperative that we tackle the operational challenges of today with a technologically driven solution that is flexible and scalable into the future. The proof-of-concept also brings in new knowledge, insights and practical experience in harnessing digital innovation – a core requirement of any exchange that aims to be a leader in its space in the future.”

SBL POC 1 is the starting point of a long-term holistic roadmap that leverages new innovations and emerging tech to address the challenges and issues present in the securities borrowing and lending market. POC 1 targets the SBL lending pool, the fundamental building block of the roadmap, and further increases the likelihood of future testing and development of more blockchain solutions that can impact the execution, collateral management and corporate action management areas of Malaysia’s securities borrowing and lending market.

Bursa Malaysia says it welcomes more collaborative efforts and partnerships with industry and tech players for future POCs. With the adoption of blockchain technology to power the region’s first of its kind PoC for its securities lending solution, Bursa Malaysia has signaled that it is willing to adopt emerging tech and new innovations in pursuit of building and implementing future-ready end-to-end SBL tech-driven solutions with the aim of developing a progressive, technology-driven market.