Home   News   Features   Interviews   Magazine Archive   Symposium   Industry Awards  
Subscribe
Securites Lending Times logo
Leading the Way,

Global Securities Finance News and Commentary.
≔ Menu
Securites Lending Times logo
Leading the Way,

Global Securities Finance News and Commentary.
News by section
Subscribe
⨂ Close
  1. Home
  2. Technology news
  3. Fusang Exchange achieves tokenisation of digital sukuk
Technology news

Fusang Exchange achieves tokenisation of digital sukuk


30 October 2023 Malaysia
Reporter: Carmella Haswell

Generic business image for news article
Image: patiwat/stock.adobe.com
Fusang Exchange, a global digital stock exchange built to enhance traditional finance, has tokenised and listed a digital sukuk.

It aims to revolutionise the Islamic investment landscape by providing investors with access to shariah-compliant high-quality liquid assets (HQLA).

According to the exchange, the tokenisation exercise is the ‘world’s first’ digitalisation of an institutionally-issued sukuk.

In addition, the digital sukuk represents the corresponding underlying sukuk issued by the International Islamic Liquidity Management Corporation (IILM).

Fusang led the tokenisation and listing exercise by using its proprietary Fusang Depository Receipt (FDR) structure to ‘wrap’ the underlying sukuk into digital form.

FDRs represent a ‘beneficial interest’ in an underlying security, which can then be listed, traded and settled on the Fusang Exchange, the firm explains.

Commenting on the announcement, Fusang Exchange CEO Henry Chong says: “Fusang’s next-generation tokenisation technology and standardised legal framework has created the world’s first truly global digital stock exchange.

“Our institutional-only digital infrastructure is built to serve, not disrupt, traditional financial intermediaries by enabling trading, custody and clearing of tokenised assets through a fully-regulated ecosystem.”

Nik Mohamed Din Bin Nik Musa, director general, Labuan Financial Services Authority, adds: “We are excited to see emerging technologies harnessed within a regulated environment, driving innovation in Islamic finance.

“We envisage that the new guidelines on Labuan Securities Token Offering would further spur the development of tokenised securities in Labuan. Leveraging on Labuan IBFC’s robust regulatory environment, Fusang Exchange’s innovation has provided the platform for listing of a unique tokenised structure cementing Malaysia's role in Islamic digital financial services.”

He adds that the issuance bodes well with the recent Budget 2024, providing full tax exemption on Islamic Finance transactions by Labuan entities aimed at positioning the jurisdiction as an Islamic finance hub.

Kelvin Ung, president of Fusang, indicates that the firm will continue to issue similar tokenised securities backed by government-linked assets, as it believes demand for HQLA will continue in the current high interest rate environment.
Next technology article →

World Bank issues first English Law DNN
NO FEE, NO RISK
100% ON RETURNS If you invest in only one securities finance news source this year, make sure it is your free subscription to Securities Finance Times
Advertisement
Subscribe today
Knowledge base

Explore our extensive directory to find all the essential contacts you need

Visit our directory →
Glossary terms in this article
→ Liquidity

Discover definitions, explanations and related news articles in our glossary

Visit our glossary →