Startup to act as link for banking, cryptocurrencies

Chief marketing officer Nicholas Chiu said the Singapore-based start-up currently holds licences in the island republic as well as in Hong Kong and Indonesia for a range of cross-border financial services, including conversion of Bitcoins and cryptocurrencies into fiat money.
For example, Bitcoins can be converted into US dollar, Thai baht and 30 other fiat currencies used in the region using licenses for payment and remittances issued by Singaporean and other regional authorities.
This will serve the need of those wanting to pay for expenses using their cryptocurrencies or to get a loan using their holding of cryptocurrencies as collateral. In other words, BridgeX is positioned to be the online platform bridging the gaps between the traditional banking world and cryptocurrencies.
The start-up aims to raise about $19 million in fresh funds to grow its business model in which conversion of cryptounits into fiat money is streamlined for various payment services, as Bitcoins and the likes gain their popularity among the mainstream population.
According to Chiu, the start-up expects to provide cross-border services in 180 countries worldwide.
Regarding Ripple, he said, the real-time settlement, currency exchange and remittance network is more focussed on B2B and inter-bank cryptocurrencies while BridgeX is more consumer-oriented for lending, currency conversion and cross-border payment services.
By 2024, the start-up forecasts to have as many as 200 million users as there are now more than six million electronic wallets, the number of which is growing rapidly, especially among the millenials or those born between the 1980s and the 2000s. Many people in this generation view cryptocurrencies such as Bitcoins and Ethereums as a new class of assets which should be used as collaterals for business loans or home mortgages, even though the value of cryptocurrencies has proved to be wildly fluctuating over the past years.
In addition, millennials in tech startups want to use their crypto-units to pay for business as well as personal expenses or even their wedding so there is a demand for conversion service to get fiat money. Yet, the advent of crypto-units has also raised concern among anti-money laundering authorities who have called for strict enforcement of the law to prevent criminals from laundering their illicit funds.
This means local banks face some restrictions due to anti-money laundering measures.
In Thailand, the Securities and Exchange Commission is empowered to regulate all digital assets, including initial coin offerings (ICOs) which Chiu said are facing a government ban in many countries. At this stage, China has adopted a more flexible policy on cryptocurrencies, while Indonesia resorts to the more conservative capital control measures.
In the event that cryptocurrency holdings are used as collateral for home or business loans, he said, lenders need a guarantee in the form of software that can manage the volatility of these units which can be sold when the value drops to maintain a safe ratio for lenders in a way similar to a margin call in stock trading.
At present, the Thai authorities also work with Omisego, another start-up, on a payment platform and decentralised exchange as the country takes steps to adopt blockchain and other digital technologies.
Due to less favourable government policies in other countries, Singapore has attracted the set-up of more than 1,000 fintech and other startups in its territory as cryptocurrencies and ICOs rapidly evolve with US$3.8 billion raised in 2017 worldwide.