Hong Kong Stock Exchange (HKEX) Insiders Say Blockchain and Crypto Assets Heavy on the Radar
Insiders Say that Hong Kong Stock Exchange is Looking to Take Over Blockchain and Other Tech Industries
According to an article from Bloomberg on September 21st, there are “people with knowledge of the matter” that say that the Hong Kong Stock Exchange is looking to upheave the blockchain sector. They also seem to have their eye on other technology sector, which is further proven by their urge towards their evolving strategy. One of their biggest concerns seems to be the fact that the trading links between China and the US are getting worse.
According to the sources, the CEO of HKEX, Charles Li, has held meetings with “at least three investment banks” as part of his effort to change the model of the exchange. That effort also includes a potential takeover of “data, analytics and blockchain sectors.” However, since this issue is such a sensitive topic right now, the sources for Bloomberg did not want their names included.
Part of the sources’ claims is that Li has used both CME Group Inc. and Nasdaq Inq. as part of the model that helped them dictate their own course of action. However, while Nasdaq has seen 19% increase in revenue for data products and 13% for market technology, HKEX earned a total of almost 100% of their revenue last year from trading and clearing fees alone.
Another claim made by the sources is that the main focus of two separate HKEX meetings was the potential for the company to acquire different technologies. The meetings took place on September 10th and September 12th. The first was a discussion involving senior managers, while the second was just for board members.
Banny Lam, who works as the head of research for CEB International Investment Corp., told Bloomberg,
“The strategy is in the right direction but it is not easy to achieve the targets. HKEX needs to maintain a momentum of growth by exploring new businesses.”
So far, HKEX has not been able to effectively integrate the London Metal Exchange, which it acquired in 2012. According to a verified but anonymous advisor, there have been many “industry concerns” regarding HKEX’s ability to score future deals.
Blockchain technology has been making a way through China for quite some time, making its way into several stock exchanges as part of the infrastructure. Even the Shanghai Stock Exchange has decided to adapt the technologies for use with transactions involving securities.
Further away, the Australia Securities Exchange (ASX) has already been working to use blockchain to replace the system that is presently in place for equity transactions. However, this adjustment to the infrastructure will not be launched until 2021.