ADDX to recognize crypto assets for accredited investor qualification

Private market exchange ADDX will recognize cryptocurrency assets for qualification as accredited investors in Singapore.

ADDX CEO Oi-Yee Choo / Photo credit: ADDX

ADDX will initially recognize three cryptocurrencies for its accreditation process: bitcoin, ether, and USD coin (USDC).

However, it will apply discounted rates when calculating the value of these crypto holdings, set at 50% for bitcoin and ether and 10% for USDC. The tokens that are counted as well as the discounted rates applied to them will be reviewed regularly, and they are subject to revisions as market conditions change.

To qualify as accredited investors for ADDX, users will need to have net personal assets worth at least S$2 million (US$1.5 million) after the inclusion of crypto assets with the discount rate applied.

Singapore regulations stipulate that to qualify as accredited investors, individuals have to meet one of three criteria: income in the past 12 months of at least US$218,250, net financial assets exceeding US$730,000, or net personal assets over US$1.5 million. While crypto assets are not currently recognized as income or financial assets, they can fall under the category of net personal assets.

In line with regulations, ADDX will also implement risk management measures that take into account the price volatility of crypto assets.

Accredited investors are allowed to participate in more sophisticated investment opportunities in the private markets, including asset classes such as private equity and venture capital funds, hedge funds, and pre-IPO companies.

ADDX CEO Oi-Yee Choo said the move comes at a time when crypto ownership rates are at record levels worldwide.

A global survey by Gemini found that crypto ownership rose by more than 80% in 2021. Ownership rates hit 30% in Singapore, 24% in Hong Kong, 20% in the US, 18% in the UK, and 17% in Germany.

See also: Meet the 50 top-funded startups and tech companies in Singapore

Founded in 2017, ADDX is Asia’s largest private market exchange. It is regulated by the Monetary Authority of Singapore as a digital securities exchange.

Currency converted from Singapore dollar to US dollar: US$1 = S$1.37.