Signum Digital, a joint venture between Cointreet and Somerley, has announced that it has received approval in principle from the Hong Kong Securities and Futures Commission (SFC) for a security token offering (STO) and subscription platform.
A security token is a new category of virtual assets based on blockchain technology that represents the ownership of tangible assets such as private shares, real estate, art and collectibles. Associated with real assets, they can reduce the risk for potential investors, facilitate their research process, and provide a basis for the market value of an investment opportunity.
Signum Digital stated that after receiving final approval from the Hong Kong SFC, it will operate the STO platform using the brand name “CS-Pro”. According to Signum, this platform will be a groundbreaking development in Hong Kong.
Last month, the Hong Kong SFC released preliminary rules for virtual asset trading platforms and called on the public to contribute. Under an upcoming licensing system scheduled to launch in June, the SFC has required digital currency exchanges to apply for licenses that will allow everyday investors to trade certain large-cap tokens.
Hong Kong has been offering new initiatives for the city’s crypto and digital asset sector since last year, when it invited firms interested in providing STO services to submit proposals.
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Cryptocurrency exchange Huobi Global also announced last month that it is applying for a license to operate in Hong Kong, possibly moving its headquarters from Singapore to a special administrative region.
Recently, Hong Kong has shown great interest in becoming a cryptocurrency hub as it has invested heavily in supporting the potential of technologies such as Web3.
In mid-December, Hong Kong launched its first two exchange-traded funds (ETFs) for cryptocurrency futures, which raised over $70 million ahead of their debut. The development came shortly after the head of the Hong Kong Securities and Futures Commission announced in October that Hong Kong was prepared to differentiate its approach to cryptocurrency regulation from China’s 2021 cryptocurrency ban.