Equos will merge with Singapore-based 8i Enterprises Acquisition Corp ahead of its listing on Nasdaq. Equos is the new digital exchange platform for Hong Kong-based Diginex. 8i Enterprises Acquisition Corp is a special-purpose acquisition company (SPAC) listed on the Nasdaq.
The exchange will initially host crypto assets with plans to introduce other derivative products in the future. At its launch, the platform will trade USD and the USD Coin (USDC) stablecoin.
SPACs are shell companies that use funds from IPOs to buy target companies. Their association to the target company brings them to the public through the “back door”. According to Diginex CEO Richard Byworth, SPACs are the easiest way to get listed as opposed to using the traditional process especially for startups. He also adds that SPACs fix valuation in advance to avoid issues that may lead to devaluation.
Merger of EQUOS.io and 8i Enterprises Acquisition Corp
The merger of EQUOS.io and 8i Enterprises Acquisition Corp which is expected to be completed in September, will make the former the first publicly-traded cryptocurrency exchange in the U.S. EQUOS.io is an enterprise-based exchange put together by a team from the traditional derivatives market. The main agenda behind the merger is to help expand the market size of cryptocurrencies which are still very nascent compared to traditional financial markets.
Diginex had planned to complete the listing much earlier after the US Securities and Exchange Commission (SEC) approved the acquisition in February followed by a shareholders’ vote on March 20 which approved the transaction. Around the same time, the global equity market was going through a down fall prompting the postponement of the listing.
Other crypto companies that are working on public listing
In addition to EQUOS.io, another crypto company that wants to go public is Ant Group, one of the principal issuers for China’s digital yuan. In addition, Coinbase one of the leading crypto exchanges in the world has announced plans for public listing in 2021.
The decision to locate EQUOS.io in Singapore as opposed to Hong Kong where Diginex is located was based on the fact that Singapore has a favorable regulatory environment for cryptocurrencies. Diginex operates several other businesses in Hong Kong.