DBS Bank, the largest bank in Southeast Asia, has launched its first security token product (STO) on its cryptocurrency exchange. The DBS Digital Bond is priced at 15 million Singapore dollars. “We expect asset tokenization to become more and more mainstream,” said an executive at DBS Bank.
DBS Bank provides security tokens for the first time
DBS Bank announced its first security token product (STO) on the DBS Bank Digital Exchange (Ddex) on Monday. The DBS digital bond is priced at 15 million Singapore dollars (approximately US$11.37 million), with a maturity of 6 months and a coupon rate of 0.60% per annum. It is offered in the form of private placement, and DBS Bank is the sole bookrunner for this transaction. Detailed description of the bank:
This paved the way for other issuers and customers to use Ddex’s ability to effectively enter the capital market to meet their funding needs, and laid the foundation for more STO issuance and listing on Ddex where asset tokenization has become the mainstream.
Clifford Lee, Global Head of Fixed Income, DBS Bank, said: “This marks the first step in the process of developing traditional bond issuance into a broader digital ecosystem in which more inclusive and inclusive development can be rapidly developed. Issuers and investors participate.”
Lee continued: “While most of the bond tokenization activities announced so far in Asia tend to be repackaged forms of traditional bond issuance, current transactions directly combine existing legal and tax infrastructure requirements with digital exchanges. Combine the issuance of small batches of bonds.” The executive added:
The emergence of this bond token structure is only due to the gradual development of Singapore’s legal and tax infrastructure, which can promote more STO issuance to broaden and deepen our capital market.
DBS Capital Markets Group Head Eng-Kwok Seat Moey commented: “Our first STO listing on DBS Digital Exchange is an important milestone… This strengthens our ability to provide integrated solutions across the entire digital asset value chain. Capabilities, from transaction initiation to tokenization, listing, trading and custody, which in turn opens the door for more STOs on Ddex.” He emphasized:
We expect that asset tokenization will become more and more mainstream, as more and more customers start to issue securities tokens as part of their capital raising activities, and we believe this will promote Singapore’s ambitions to become a digital asset center in Asia.
DBS Digital Exchange was launched in December last year. Its website explains that it provides “interchange services between four legal currencies (SGD, U.S. dollar, Hong Kong dollar, Japanese yen)” and four “cryptocurrencies, namely Bitcoin, Ether, Bitcoin Cash and XRP” .
The bank disclosed in its first quarter earnings conference call that its cryptocurrency exchange “has gained strong market traction since its launch.” Specifically, its “daily trading volume has increased 10 times from the first week of launch, and the exchange currently serves more than 120 participants. DBS Bank also holds more than S$80 million in its custodial services Digital assets,” the bank revealed. In May, the bank launched a cryptocurrency trust service.
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