Are Singapore VCs Losing Out To ICOs?

Funds raised by ICOs have already overtaken angel and seed venture capital (VC) funding, raising more than US$550m for issuers globally, compared to the US$300m raised from VC firms by June of last year.

In June, Singaporean fintech startup TenX raised close to US$80m from a token sale, making them one of the most succesful start ups globally to launch an initial coin offering (ICO). TenX aims to bring bitcoin into the real world by converting cryptocurrency into fiat money in a physical Visa-backed card, noted TenX founder Dr. Julian Hosp.

As more startups like TenX utilise these virtual currencies as a more innovative alternative to raising capital and expanding their operations, the Monetary Authority of Singapore (MAS) published a paper offering general guidance on the regulation of digital token sales. ICOs, particularly, are increasingly becoming mainstream as a way for startups to raise funds, with 200 ICOs raising over US$3.3b globally last year. Studies indicate that Singapore is currently the third largest ICO hub in the world after the United States and Switzerland and this situation will likely ride on an upward trajectory given the policy and regulatory backing by the Singaporean government through MAS.

Notable deals in 2017

Singapore Business Review rounded up the biggest ICOs of 2017 by Singaporean raisers, and whilst we cannot verify all funding quantums, we believe the table pretty much sums up the most talked about ICOs in 2017. Some of the notable deals in 2017 include US-Singaporean startup Quoine which raised US105m in funding.

Nizam Ismail, partner at RHTLaw Taylor Wessing also cited Aptoide, an app store with 200 million users, which successfully raised US$15m out of Singapore. They are considered the first app store to use blockchain. There is also Megax, a Singapore-based company that set up an e-commerce fashion ecosystem. Based on our compiled list, these major deals amounted to US$381.42m in funding, with average funding around US$25.43m.