Ever-increasing know-your-customer (KYC) and ever-complex anti-money-laundering (AML) practices are imposed by the Financial Action Task Force (FATF) guidelines. All these and more are essential considerations for embracing digital assets. These practices keep billions in poverty and kill innovation by locking out the competition.
At Virtuse, we’ve always viewed our mission in providing a platform that can serve as the one-stop solution for global investors regardless of where they come from or how much money they have. Being one of the largest energy traders in Europe, we have chosen commodities, to begin with. It is an industry that is ripe for disruption, and at Virtuse, we believe we have a solution to suit.
From Commodities Trader to Multi-asset Platform
Like many online-trading platforms, Virtuse started as a traditional broker before gravitating to digital assets. Established in 2006 as an investment manager, the company transformed into carbon, electricity and gas trader, three years later.
The leap from energy trading to formulating a digitized commodities market was a natural one, given the company’s presence in Singapore. However, the main reason for the transition was in our conviction that commodities should be accessible for all, not only to the large institutions or accredited investors. Democratizing an entire asset class and massively increase the total addressable market by the ignored 95% of the world’s population is a necessity.
We build the first of its kind digital multi-asset exchange – a market, where hard to access assets are digitized and traded freely with cryptocurrencies. Without any requirements for large deposits or collaterals, we are practically making commodities tradable in ten dollar fractions at a time. And all that is possible without the need to convert to fiat.
Protect and unlock value
But that’s not all. By digitizing commodities, we’re also unlocking the value contained within these traditional hard-to-shift assets. Even though Bloomberg Commodity Index gained over 6% in 2019, overall commodities are still almost 50% below their peak level in 2012. Considering their limited downside, since the prices cannot fall to zero, there is a high potential for growth 2020.
Another problem that Virtuse solves is that digital commodities facilitate safe haven for the price swings in stocks, as well as in cryptocurrencies. Commodities have shown to be a non-correlated asset to traditional markets, and bitcoin. Having some digital commodities in your portfolio provides sufficient protection. And again, all this is possible without moving your assets from the platform.
Grander challenge: Unlocking $300 trillion market
Although we believe that in commodities, we’ve found a prime candidate for the digital transformation, we’re not stopping there. The vision going forward is to tackle on a grander challenge altogether: digitizing the $300 trillion of global financial assets. Our digital platform is on the right track to unlock billions of dollars of value and create a one-stop-solution for everyone, even the excluded 95% of the world’s population, one asset class at a time.
Ras Vasilisin is the founder and CEO at Virtuse Exchange, Singapore-based multi-asset platform with a significant presence in the EU, that allows investors in more than 100 countries to trade crypto and traditional assets. Follow Ras on Twitter and Linkedin.