Coinstreet Holdings Limited, a leading global professional consultancy group and solution provider in the digital asset sector since 2017 (“Coinstreet”), and a subsidiary of Somerley Capital Holdings Limited (stock code: HK.8439), a leading financial group headquartered in Hong Kong with an established history and proven track record in the corporate finance advisory space in Greater China (“Somerley”), have entered into a joint venture agreement with an aim to provide professional advisory and management consulting service for security token offerings (“STO”), and to serve the rising need for asset tokenization and fundraising through issuing of digitized securities from Hong Kong enterprises (“JV”). The JV will apply for all required approvals and licenses under the regulatory framework and guidelines from the Securities and Futures Commission (”SFC”). Subject to the satisfaction of the relevant regulatory requirements, it is envisaged that the JV will develop “CoinstreetPRO Hong Kong,” an online initial subscription platform and primary market brokerage services for tokenized assets and digital securities (“TADS”) serving institutional and professional investors. It is intended that the JV will work with other licensed virtual asset trading platforms and STO exchanges for secondary trading activities.
Virtual assets, including STOs, are emerging as an innovative way to facilitate capital raising and investment in businesses and projects. STOs typically refer to specific offerings which are structured to have features of traditional securities offerings and which involve security tokens utilizing blockchain technology. A comprehensive STO offering implemented within the Hong Kong regulatory environment would offer issuers an alternative avenue for fund-raising and professional investors an investment opportunity alongside with the more traditional fundraising routes. By combining Coinstreet’s highly innovative Fintech solutions and technical expertise in STOs from overseas markets, and Somerley’s extensive experience and best governance practices in the conventional corporate finance and advisory sector, this strategic partnership provides adequate resources and know-how to power the development of the JV’s STO business.
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Samson Lee, Founder and CEO of Coinstreet said, “Through asset tokenization, institutional and professional investors can access to a wide range of alternative investment opportunities, while it also allows enterprises, private equities, asset managers, and businesses to benefit from a new form of structured finance. We are excited about our partnership with Somerley and believe this collaboration can foster convergence between traditional finance and digital assets and tap into ample opportunities ahead.”
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Martin Sabine, Chairman of Somerley commented, “Hong Kong, as an international financial centre and gateway to Mainland China, has considerable potential to develop its blockchain-based Fintech offerings. With a favorable regulatory environment in Hong Kong, Coinstreet’s expertise and our established business operations in Greater China, this collaboration is an opportunity to bring together traditional finance and digital asset innovation to capture the potential of the virtual asset space.”
According to a survey from the World Economic Forum, 10% of the world’s GDP will be tokenized by 2027 — with an estimated market capitalization of US$24 trillion. A wider adoption of digital assets by financial institutions and large enterprises is expected, thereby generating momentum for new growth in the financial industry.
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