Singapore, where Blockchain reinvents itself

Singapore, where Blockchain reinvents itself

It has become quiet around Bitcoin and its fellow Altcoins. Even though Bitcoin has gained some traction and is currently searching its equilibrium at around 11‘000 USD, the future of cryptocurrencies, and the thousands of projects funded during the last cryptocurrency bull run, is unclear. The question remains, is the industry doomed to fail or ready for unexplored heights? Singapore, a crypto and Blockchain hub since the early days, might give some indicators about the future direction.

New marketing course

A major shift recognizable, not only in Singapore but in all Blockchain hubs around the globe, is the diminishing number of startups trying to set Blockchain as their main value proposition. This is explainable because it is extremely hard to gain reputable Venture Capital funds and private equity investors since the bust of the last ICO bubble and the revealing of thousands of fraudulent projects. The reputation of the whole Blockchain industry has still not recovered and there is still a lot of terminological and technical confusion going around.

For this reason, most startups trying to integrate Blockchain-related elements do not market themselves as crypto or Blockchain companies but set the focus of their marketing campaigns away from Blockchain and on other parts of their business model.

The new trend towards Digital Security Offerings

As it seems especially difficult to acquire institutional funds in the current market, most of them still engaged projects are highly professional. It is observable that there is a move away from the last bull run’s theme „put everything on a Blockchain“ to a more realistic approach. Only those projects showing the ability to realize their vision in an acceptable timeframe combined with real benefits to the status quo will attract new funds. Hence, it looks like Digital Security Offerings (DSO) are one of the most promising Blockchain use cases for the next years.

Digital Security Offerings (DSO)

DSO‘s have nothing in common with cryptocurrencies, besides integrating Blockchain-based technology. The idea is simple, physical assets or securities like real estate, private equity or venture capital will be represented through the process of tokenization. The token and its value will be determined by the backing assets. The tokenization of illiquid assets and securities will make them securely and seamlessly manageable and provides secondary trading options enhancing current liquidity issues for institutional and retail investors. DSO’s could solve major issues for mid-range institutional investors with the current paper-based system and could be a new smart form of financial services. In November, a DSO project called „Securitize“, was funded with 12.75 million to fulfill this vision. The Singaporean company “InvestaCrowd” is as well operating in the Digital Security Offerings sector and wants to provide fully licensed end-to-end DSO services including advising options for DSO issuers and the availability of an in-house secondary exchange for investors.

Shift away from the Blockchain paradigm

The Blockchain industry is still in the discovery phase. However, many investors but also Blockchain-based projects themselves have recognized that the technology can be essential to realize new business models but should not be the only argument. With the lack of potential investors only the best projects will survive but with the prospect to give the industry new credibility and bring valuable real-world adoption.

written by Ato Herzig

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