SGX and Temasek to advance digital asset infrastructure in capital markets

By Edil Corneille

Today, Singapore Exchange (SGX) and Temasek announced their entry into a joint venture (JV) which is set to be Asia Pacific’s exchange-led digital asset venture focused on capital markets workflows through smart contracts, ledger and tokenisation technologies.

This builds on the successful collaboration between SGX, Temasek and HSBC which culminated with the issuance of Asia’s public syndicated digital bond for Olam International in August 2020. In all, SGX’s digital asset issuance, depository and servicing platform was used to issue four digital bonds by several issuers, with a total size of over S$1 billion.

The partnership between SGX and Temasek combines SGX’s multi-asset experience and strengths in operating market infrastructure to the highest regulatory standards, together with Temasek’s expertise in blockchain technology and ecosystem connectivity.

The JV will look to partner with fixed income issuance platforms to connect to its post-trade and asset servicing infrastructure, providing issuers, arranger banks, lawyers, investors and paying agents with a comprehensive, issuance-to-settlement network for Asia bonds. Concurrently, the JV will focus on other existing and emerging asset classes that have seen growing market demand, including funds and sustainable finance.

Lee Beng Hong, Senior Managing Director, Head of Fixed Income, Currencies and Commodities (FICC), SGX said, “The early success in our digital bond issuance platform has paved the way for SGX to make a larger move into digital assets, and we are very excited to take our digital asset business to the next level in partnership with Temasek. Together, we will capitalise on digitalisation trends that continue to shape global capital markets, and advance the development of capital markets infrastructure in Asia.”

Pradyumna Agrawal, Managing Director, Blockchain@Temasek added, “We have been tracking the evolution of financial market systems and the opportunities for development of digital infrastructure that will transform how financial transactions are conducted. We are pleased to partner SGX in this effort towards continual improvement of capital markets through the development of innovative end-to-end digital asset solutions.”