Signum Digital Achieves Security Token Offering Approval from Hong Kong’s SFC

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Key takeaways:

  • The Securities Token Offering from Signum Digital has received preliminary approval from the Hong Kong Securities and Futures Commission.
  • The SFC requires digital currency exchanges to allow regular investors to trade high-capitalization tokens.

Signum Digital, a joint endeavor between Coinstreet and Somerley, released an announcement. Signum Digital has received preliminary approval from the Hong Kong Securities and Futures Commission (SFC) regarding its security token offering (STO) and membership platform.

Using blockchain technology, security tokens are an emerging category of digital assets that reflect the ownership of physical assets like private stocks, real estate, fine art, and collectibles. The tokens’ ties to physical assets may reduce risks for prospective investors, speed up the research process, and establish a base for the investment opportunity’s market worth.

After receiving final approval from Hong Kong’s SFC, Signum Digital asserts that it will handle the STO platform under the trade name “CS-Pro.” According to Signum, this tool will be a ground-breaking innovation in Hong Kong. Samson Lee, the CEO of Signum Digital and the creator of Coinstreet, said:

“the company aims to fill a gap in traditional fundraising channels where SMEs face many challenges, and professional investors also have limited options for high-quality alternative investment opportunities.”

The Hong Kong SFC published draft rules for trading platforms for virtual assets last month and requested feedback from the public. The SFC required digital currency platforms to file license applications under the forthcoming authorization system, which will launch in June and permit regular investors to trade particular high-capitalization tokens.

Since requesting proposals from companies interested in offering STO services last year, Hong Kong has been putting forth new efforts to develop the city’s crypto and digital asset sectors.

Huobi Global, a cryptocurrency exchange, also revealed last month the company had submitted an application for authorization to function in Hong Kong and may relocate its headquarters there from Singapore.

Hong Kong recently demonstrated significant interest in developing into a crypto hub, spending a lot of money to promote the potential of technologies like Web3.

Hong Kong introduced its first two exchange-traded funds for cryptocurrency futures in the middle of December 2022, and they gathered more than $70 million before going public. The announcement that Hong Kong is ready to differentiate its approach to regulating cryptocurrencies from the Chinese crypto ban that will take effect in 2021 was made by the head of Hong Kong’s SFC in October, just before the event.

Hong Kong’s regulatory structure seeks to balance promoting creativity in the fintech industry, including virtual assets, and protecting investors. Hong Kong’s status as a top base for the digital asset industry is anticipated to be further strengthened by the acceptance of Signum Digital’s STO platform.

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