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Subsidiary of SGX-listed Y Ventures launches US$50m initial coin offering

SINGAPORE — In a first for a listed company in Singapore, e-commerce firm Y Ventures Group has launched a US$50 million (S$68 million) initial coin offering (ICO) through its subsidiary, Luminore.

SINGAPORE — In a first for a listed company in Singapore, e-commerce firm Y Ventures Group has launched a US$50 million (S$68 million) initial coin offering (ICO) through its subsidiary, Luminore.

The Catalist-listed company is offering what is touted as "the world's first blockchain-enabled global buying platform", it said in a press release on Tuesday (July 31), and is seeking to raise money to develop Aora, an e-commerce platform that uses cryptocurrency in digital transactions.

Luminore — a joint venture between Y Ventures and Arke Blockchain Engineering — will be looking to raise the capital by releasing 250 million Aora "coins" for sale out of a total of 625 million. The sale starts Tuesday and ends Nov 30.

Consumers will be able to use cryptocurrencies, such as Bitcoin and Ethereum on top of government-backed currencies, to buy products from major online marketplaces through Aora.

Y Ventures plans to have e-commerce giants including Amazon and Taobao onboard by the second quarter of next year.

By the fourth quarter of next year, it is aiming to have other players such as Expedia and Booking.com join Aora, which is expected to be launched in the first half of 2019.

While recognising that cryptocurrency has still not yet reached mass adoption — Bitcoin is accepted at only three of the top 500 merchants — Luminore's chief executive officer Cedric Choy said that the ICO will ensure the "long-term viability and sustainability of the platform". It will also give users, "including the unbanked in emerging parts of Asia who are increasingly early adopters of cryptocurrency, access to a commercially viable token", he said.

"This is an exciting development for both the e-commerce industry and the cryptocurrency market," he added.

An ICO works like an initial public offering (IPO) but instead of issuing shares, companies offer their own virtual coins — also known as tokens — which can be bought with cash or other cryptocurrencies.

However, unlike shares which are a form of securities, the Aora coin is a utility token built on the Ethereum network, Y Ventures highlighted. This means that it is unlikely to fall within the Monetary Authority of Singapore's regulatory ambit under the Securities and Futures Act.

Plugging the platform's ability to "solve e-commerce inefficiencies", Y Ventures said that merchants will be able to save up to 8 per cent on transaction fees through Aora's blockchain payment gateway Aora Pay.

In March, Y Ventures signed a non-binding memorandum of understanding with Singapore Post with the aim of improving its logistics efficiency.

The firm uses data analytics to draw information on the distribution and sales of products worldwide across several major online marketplaces in North America, Europe and Asia-Pacific.

Its chief executive officer Alex Low said that the development of Aora, which will be a "new growth pillar" for the company, is an indication of the company's optimism in the growth potential of the e-commerce industry.

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