- EQONEX will streamline to focus on Asset Management and
Custody
- EQONEX to proactively exit the crowded crypto exchange space,
closing its crypto Exchange on August 22,
2022
- Exchange clients will have sufficient time to manage and close
their trading positions and withdraw their assets off the
exchange
- The Exchange closure will materially reduce the Company's cost
structure and position the Company for sustainable growth.
SINGAPORE, Aug. 15,
2022 /PRNewswire/ -- EQONEX Limited (NASDAQ: EQOS)
("EQONEX" or the "Company"), a digital assets financial services
company, today announced that it is taking decisive action to
streamline its operations and focus resources primarily on the
businesses that offer the most potential for revenue growth and
long-term financial sustainability: Asset Management and Custody.
The Company will proactively exit the crowded crypto exchange space
by closing the Exchange.
EQONEX Chairman Chi-Won Yoon
recently outlined the Company's strategic priorities and
intention to focus its resources on businesses where it has
significant competitive strengths and can leverage its traditional
finance expertise and experience. The decision by the EQONEX Board
of Directors to accelerate its strategic plan and close the
Exchange is in alignment with this strategic framework.
Closing the Exchange will improve the Company's financial
position by materially reducing the high-cost structure associated
with operating the Exchange, and free up resources to drive growth
in the segments where it has significant competitive strengths.
The Exchange was launched during a period of rapid growth and
competition within the crypto industry, and the market is now
comprised of close to 300 spot exchanges, many of which share
comparable features. Intense market competition and low margins,
combined with the significant technological load required to ensure
optimal performance has made running a profitable exchange
increasingly challenging, especially in the current environment
where crypto exchange volumes have fallen.
EQONEX's Asset Management business encompasses Investment
Products and Bletchley Park, a fund of crypto hedge funds. The
Investment Products business recently received approval from
Germany's Federal Financial
Supervisory Authority (BaFin) for the issuance of an
exchange-traded products, which resulted in the launch of the
EQONEX Bitcoin Exchange-Traded Note (ETN) on the Deutsche
Börse XETRA Exchange in July
2022.
In addition, EQONEX will be launching a Structured Products
business in the near future that will offer professional investors
and institutions exposure to bespoke crypto investments. The
Company also recently announced several high-caliber, senior
appointments to the Asset Management team to drive growth in
Asia and Europe.
Digivault, the group's digital asset custody business, is in the
unique position of being one of only a few digital asset custody
providers to be registered with the Financial Conduct Authority in
the United Kingdom. Digivault is a provider of choice for law
enforcement agencies and recently became the first custody
partner of poundtoken.io, the first British-Isles regulated and
100% backed GBP stablecoin.
The Company's focus on regulation and governance has also been a
driving feature since its inception, and it plans to continue its
efforts to secure regulatory licenses for its on-going businesses
with the Monetary Authority of Singapore and the Gibraltar Financial Services
Commission.
EQONEX CEO Jonathan Farnell said,
"We are focused on opportunities that will drive revenue growth and
position us for long-term success. Closing the Exchange will
significantly simplify our business, narrow our focus, free up
resources, and allow us to operate as a more efficient organization
with capacity to aggressively go after market segments that offer
the most potential."
"The recent extreme market volatility and declining trading
volumes have added to the headwinds being felt by exchange
operators. We take a realistic view that our exchange will
not move the needle for us financially over the near-to-medium
term. We don't see value in continuing to bear the costs of
operating an exchange during what may be a prolonged market
downturn. We have conviction that proactively exiting the
crowded exchange space is the right decision to deliver shareholder
value."
"Our Asset Management and Custody business, Digivault, have
already made solid progress with the additional resources that we
have allocated to them recently, and we are bullish about their
prospects as we become an organization focused on these
high-potential business areas".
EQONEX Chairman Chi-Won Yoon
said, "Nimble and resilient companies can adapt and evolve to
navigate market conditions and exploit opportunities. We are now
firmly committed to the areas where we have the expertise and
experience to serve a growing customer segment, and where we can
ultimately deliver the most investor value."
"Digital asset custody and asset management businesses have high
barriers to entry given their unique security, technology and
regulatory specifications. We have already laid solid
foundations for our businesses to thrive, and with increased focus
and resources, we are well positioned to harness our competitive
advantages and capitalize on market opportunities."
EQONEX's principal place of business will move from Hong Kong to the United Kingdom given Asset Management and
Custody operations are predominantly UK-based, together with the
majority of the Executive Management team.
Timeline for Exchange customers:
EQONEX aims to provide customers with sufficient time to trade
out of existing derivative positions and withdraw assets from the
exchange before it ceases operations.
- The Exchange will close for trading at 08.00 AM UTC on 22 August
2022. Clients should aim to close out their derivative
trading positions during this seven-day window.
- Customers will then have between 15 August and 8.00 AM UTC on 14 September (30 days from this
announcement) to withdraw their assets into another wallet.
Withdrawal fees will be waived.
- The EQO token, being an exchange-only token that cannot be
withdrawn, will cease trading with immediate effect. EQONEX will
communicate with holders directly regarding their EQO balance.
- More detailed customer information is available at
www.eqonex.com
About EQONEX
EQONEX Limited (NASDAQ: EQOS) is a technology driven digital
assets financial services group that provides institutional grade
infrastructure and a full suite of trading, custody and asset
management solutions to clients. The Group's digital assets
ecosystem has been designed to accommodate the needs of
institutions and individuals with the same degree of regulatory
oversight and security they are accustomed to in traditional
financial markets. EQONEX's ecosystem primarily encompasses
Digivault, a FCA- registered custodian, Asset Management which
encompasses investment products, and Bletchley Park, a fund of
crypto-hedge funds, and Brokerage which includes Structured
Products, OTC and lending services.
For more information visit: https://group.eqonex.com/
Follow EQONEX on social media on Twitter @eqonex, on Facebook
@eqonex, and on LinkedIn.
Forward-Looking Information
Any forward-looking statements in this press release are based
on available current market material and management's expectations,
beliefs and forecasts concerning future events impacting
EQONEX. You are cautioned that any such forward-looking
statements are not guarantees of future performance and involve
risks and uncertainties, as well as assumptions, which, if they
were to ever materialize or prove incorrect, could cause the
results of EQONEX to differ materially from those expressed or
implied by such forward-looking statements. The
forward-looking statements made in this press release speak only as
of the date hereof and we disclaim any obligation, except as
required by law, to provide updates, revisions or amendments to any
forward-looking statements to reflect changes in our expectations
or future events.
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SOURCE EQONEX
