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Today, Standard Chartered Bank announced the creation of a joint venture in Singapore, Olea, with supply chain finance start-up Linklogis, known for its use of blockchain. The target is institutional investors looking for an alternative asset class. We asked if these trade finance assets could be symbolized as digital assets.
At the start of last year, the bank invested in Hong Kong-based Linklogis, which primarily serves Chinese buyers and their suppliers, after first working with the supply chain finance company in early 2019. .
As with most supply chain finance solutions, a large enterprise buyer integrates their suppliers into the platform. Due to the buyer’s creditworthiness and the verification of the transaction, the risk is significantly reduced and the blockchain adds another layer of transparency. It allows providers who would otherwise not be creditworthy to attract financing at an affordable rate.
It is also a sector that has attracted institutions looking for different asset classes. Previously, Linklogis had issued several asset-backed securities depending on the credit granted.
Prior to Standard Chartered’s investment in 2020, Linklogis had raised $ 260 million, including a $ 220 million Series C round in late 2018 led by the Singapore Government Investment Corporation (GIC).
The CEO of Olea will be Amelia Ng of SC Ventures, and the Deputy CEO will be Letitia Chau, vice president of Linglogis.
“By combining Standard Chartered’s international trade and risk management expertise and unrivaled knowledge of Asia, Africa and the Middle East with Linklogis’ innovations in supply chain technology , Olea is uniquely positioned to reinvent trade finance and be a force for good, ”said Ng.
“Olea aims to disrupt today’s trade finance model by matching the financing needs of suppliers with alternative liquidity from investors looking for an attractive asset class linked to the real economy.
In recent months, Standard Chartered’s venture capital arm, SC Ventures, has shifted from taking minority investments to forming joint ventures in the blockchain and digital asset sector. At the end of last year, he created Zodia, a digital asset custody startup in London, in which Northern Trust is also involved. In June, he announced plans for the brokerage and exchange of digital assets in London in conjunction with the Hong Kong-listed BC Technology Group.
This is why we have raised the question of whether these trade finance assets could be tokenized as digital assets. Singapore is home to more than one blockchain-based trade finance solution with billions of transactions, including Triterras and dltledgers.
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