In this edition of the Protocol Newsletter, we spoke with Henry Chong, Fusang CEO about why they are in an excellent position to drive liquidity for digital securities, why they decided to partner with Securitize, and more.
1. Who is Fusang and what do you do?
As Asia's first fully-licensed digital stock exchange, we are excited to fulfill the long-standing promise of digital securities/security tokens. The ability to digitize securities not only allows for them to be traded quicker, cheaper, and more easily, but also allows for companies to rethink the value networks they create and what it means to be a shareholder. The future of securities is digital, and we have proven this by issuing our own digital equity (FSC).
2. What is Fusang known for?
Fusang was previously known for its family office investment services. In February 2019 it was restructured with an exclusive focus on FinTech and the digital asset economy. The current leadership team is comprised of financial veterans, technology gurus, and former government officials, and the team brings 35 years of operational experience running regulated financial infrastructure.
3. What makes Fusang different from other exchanges?
There are traditional exchanges like HKEX and SGX that deal with traditional securities, and there are crypto exchanges, like Binance, Gemini, and Coinbase that focus on cryptocurrencies and altcoins. Fusang is a unique blend of the aforementioned in that our focus is on the native digitization of securities recognized by our investor base.
4. In what capacity does Fusang work with digital securities and what attracted you to them originally?
We run a full-fledged securities exchange where digital securities/security tokens can be listed, traded, and stored. It's like Amazon but for digital securities. The exchange is the marketplace to list your security token, the product, and investors can buy and make a settlement in a compliant and safe manner.
The native digitization of securities is not what excites us, but rather what digital securities allow companies to do in turning stakeholders into shareholders.
5. What, in your eyes, are the biggest pros and cons of using digital securities?
Digital securities are no different from traditional, paper-based securities, just with a different technology layer. Digital securities can be stored, transferred, and traded far more easily than paper-based securities. The biggest con is that digital securities are a different asset class to paper-based securities. Investors should be looking at the underlying asset that they own as a result, not the nature of any given "token".
6. Why did you decide to partner with Securitize?
Securitize has established itself as a leading issuance platform, and many of the issuers we've met have explored using Securitize as an issuance platform: including, of course, Fusang itself!
Before establishing the partnership, Fusang engaged Securitize to facilitate the digitization of Fusang Corp's (FSC) own equity in a purely digital format. Fusang Corp has issued over 58 million FSC shares to date, with 4 million more shares to be offered in a current pre-IPO fundraising round (fusang.co/invest-fsc), with a full and public IPO targeted to launch in 2021.
Fusang is the licensed & registered Transfer Agent for all FSC digital shares, and all transfers get updated in real-time on the blockchain and are viewable to the public (fsc.fusang.co). FSC digital shares can be held in Fusang Vault's institutional custody infrastructure. Issuers can access this same end-to-end solution for issuing company equity and be listed on the Fusang Exchange.
In the coming months, we look to further explore the utilization of Securitize's comprehensive product offering and promote Securitize's issuance platform to its pipeline of issuers.
7. Why is Fusang in a good place to drive liquidity using digital securities?
Liquidity is key for any exchange to attract investors and the digital securities industry itself is waiting for that tipping point where the flood gates open with the institutional flow of capital. The fact is institutions will only work with properly licensed exchanges that can deal in securities, which Fusang is allowed to do with its Securities Exchange Licence. It's the reason for the healthy inflow of trading agents partnering with Fusang in creating an active distribution channel.
Additionally, our exchange gives retail investors direct access to invest without an intermediary or broker, which has allowed us to open up multiple channels for global participation. The next step is now curating a pipeline of issuers that match the investor's appetite.
8. Do you feel like Fusang is leading the competition? If so, why?
Whoever is seen as competition, we openly welcome as this market needs further validation to accelerate the adoption of digital securities. More businesses entering this space gives us confidence and reason to believe we are in the right business.
About Fusang and Henry Chong
ABOUT FUSANG CORP (FSC)
Fusang Corp, established in 2014, is the first fully-regulated platform in Asia providing end-to-end infrastructure to support Security Token Offerings (STOs), allowing both retail and institutional investors to access the digital asset markets in a secure, compliant, and convenient way. Fusang Corp has issued all of its equity as digital shares (see fsc.fusang.co for our real-time blockchain-based cap table).
ABOUT FUSANG EXCHANGE LTD
Fusang Exchange Ltd, a subsidiary of Fusang Corp, is licensed in Labuan, Malaysia as a Securities Exchange under Part IX, Section 134 of the Labuan Financial Services and Securities Act 2010 (LFSSA). Fusang Exchange is the first fully-operational stock exchange in Asia that allows for companies to go public through a digital IPO accessible by both retail and sophisticated investors globally. Fusang supports the trading of both digital securities and cryptocurrencies.
For more information, visit fusang.co/exchange
ABOUT FUSANG CUSTODY LIMITED
Fusang Custody Limited, a subsidiary of Fusang Corp, operates the Fusang Vault, a secured digital asset custody platform, and Fusang Digital Identity, an AI-powered KYC/AML solution. Fusang Custody acts as Custodian & Transfer Agent for Security Tokens, providing a full platform to manage & operate digital security issuances. Fusang Custody Limited is licensed as a Trust or Corporate Services Provider (TCSP) in Hong Kong.
For more information, visit fusang.co/vault
Securitize delivers trusted global solutions for creating compliant digital securities. The Securitize compliance platform and protocol provide a proven, full-stack solution for issuing and managing digital securities (security tokens). Securitize's innovative DS Protocol has the highest adoption rate in the industry and enables seamless, fully compliant trading across multiple markets simultaneously. Multiple Securitize powered digital securities are already trading globally on public marketplaces with many more in the pipeline.
To learn more, please visit our website.
This site is operated by Securitize, Inc. (“Securitize”), which is not a registered broker-dealer. Securitize does not give investment advice, endorsement, analysis or recommendations with respect to any digital securities. All digital securities powered by Securitize’s technology are offered by, and all information related thereto is the responsibility of, the applicable issuer of such digital securities. Neither Securitize nor any of its officers, directors, agents and employees makes any recommendation or endorsement whatsoever regarding any digital securities powered by Securitize’s technology. Nothing on this website should be construed as an offer, distribution or solicitation of any digital securities. Securitize does not provide custodial services in connection with any digital securities powered by Securitize’s technology.