Malaysia property developer Hatten Land Limited said Monday, its wholly-owned subsidiary Hatten Technology (S) Pte. Ltd. (Hatten Technology) has entered into an agreement with Singapore fintech company HydraX Pte. Ltd. (Hydra X) to set up a joint venture company to jointly develop and operate “first-of-its-kind” cryptocurrency exchanges (Crypto Exchanges) in Singapore and Malaysia.
The Crypto Exchanges will focus on listing and trading of newly-minted Bitcoins (also known as ‘Virgin Bitcoins’ or ‘Clean Bitcoins’), eco-friendly BTC wrapper tokens (‘Green Bitcoins’), as well as other ‘green’ cryptocurrency, tokens and/or ‘green’ credits, Hatten Land said in a statement.
In addition to operating the exchanges, the joint venture will also generate revenue by providing custody services for the cryptocurrencies and tokens that are being traded.
The joint venture is the latest initiative undertaken by Hatten Land to re-purpose its malls in Melaka and align its business model with the growth trends of the digital economy. The group has announced plans to create a ‘metaverse’ digital twin of historical Malaysian city and to develop a dedicated token system, and create digital assets, including nonfungible tokens (NFTs).
Hatten Land is also working with partners to install solar panels on rooftops of the malls and potentially build large-scale solar photovoltaic (LSSPV) facilities of 100 MWp. These panels will enable environmentally-friendly cryptocurrency mining which will commence with 3,000 mining rigs to be operated with two different partners. The digital assets derived from these new initiatives may also be listed or traded on the Crypto Exchanges.
With every transaction being recorded on distributed ledgers, regulated financial institutions might reject Bitcoins that may have been used for illegal activities. However, freshly minted ‘Virgin Bitcoins’ with no transaction history are considered pristine and can potentially command a premium. ‘Green Bitcoins’ mined with renewable energy sources are also gaining popularity among cryptocurrency investors.
Under the joint venture agreement, Hatten Technology will hold a 60 percent equity stake in the joint venture company with the remaining 40 percent equity stake to be held by Hydra X.
As partial consideration for the development costs for the Crypto Exchanges, Hydra X will be issued new ordinary shares of Hatten Land and Hydra X will become a shareholder of the company.
Hatten Land has also proposed to issue 20 million new ordinary shares at S$0.06 ($0.04) per share to technology-focused investor Golden Summit International Ltd, of which 70 percent of the net proceeds will be used to fund new business initiatives of the group and the rest will be used for working capital.
“This joint venture to develop and operate Crypto Exchanges is strategic to our digital and blockchain initiatives. The listing and trading of digital assets will significantly enhance the value proposition of our strategic pivot towards the digital economy. While cryptocurrencies are becoming mainstream, we foresee a growing demand for ‘Virgin’ and ‘Green’ Bitcoins amid the rising ESG trend and we look forward to harnessing the opportunities in this area,” said Colin Tan, Executive Chairman and Managing Director of Hatten Land.
Hydra X Chief Executive Officer Daryl Low also said the initiative is a step towards fulfilling Hydra X’s aim to help catalyze institutional adoption of digital assets.
“We look forward to a fruitful partnership with Hatten Land to enable global trading in the digital capital markets space while playing a part in promoting environmental sustainability by addressing concerns of socially conscious investors,” he said.
According to Hatten Land, the Crypto Exchanges and related custodian services are subject to obtaining the necessary regulatory approvals which the joint venture company will be applying for in both countries.
Hatten Land is Malaysia’s property developer specializing in integrated residential, hotel, and commercial developments. Headquartered in Melaka, it is the property development arm of the conglomerate Hatten Group, which is a brand in Malaysia with core businesses in property development, property investment, hospitality, retail, and education.
Hatten Land began trading on the Catalist board of Singapore Exchange on February 28, 2017, after the completion of the reverse takeover of VGO Corporation Limited.
Singapore-headquartered Hydra X offers digital technology infrastructure to global financial institutions in the capital markets space. It provides regulatory compliant, end-to-end multi-asset market infrastructure solutions which allow interoperability between digital and traditional assets. Headed by Daryl Low, Hydra X’s management team has altogether 60 years of experience in finance, financial regulation, law, and technology.
Hydra X’s customers include financial institutions such as DBS and currently provides custodian services for digital securities under the FinTech Regulatory Sandbox of the Monetary Authority of Singapore (MAS).
Meanwhile, Golden Summit invests in consumer and enterprise tech companies in Southeast Asia, North Asia, and North America, focusing on enterprise software, FinTech, e-commerce, and the healthcare industry. Its investments include Coupang, the largest online marketplace in South Korea, and Stockbit, a popular Indonesian stock trading app, among others.