TOKENIZING CFD INVESTMENT
Malaysian owned blockchain company CSD is augmenting the new financial frontier with tokenized solutions for contract for difference (CFD) investments.
Emerging blockchain technologies have revolutionized traditional finance by creating easier and more affordable means of spending, investing and transferring wealth around the globe. However, despite their growing visibility, public adoption still lags behind that of mainstream financial instruments such as stocks and contract for difference (CFD). Moreover, no single platform exists to enable the interaction of newfangled digital currencies and traditional markets for trading shares and foreign exchange (forex).
Realizing this gap in today’s crypto currency markets, the founders of Malaysian-owned blockchain company CSD has put together its traditional markets experience to devise a comprehensive solution: a blockchain-based financial instrument which includes a state-of-the-art CFD trading platform. By resolving some of the issues behind CFD trading, CSD’s mission of bringing popular investment instruments to blockchain-based markets will change the current financial trading landscape.
CFD is a popular form of highly leveraged derivative product that enables traders to speculate on price movements in global financial markets or instruments such as shares, indices, futures and other commoditized instruments. One of the primary advantages of trading a CFD is that it involves speculating on the price movement of a chosen asset without actually owning the underlying instrument. Although similar to the trading of shares, whereby returns and losses are based on the buying and selling prices, CFD trading offers a higher leverage and ease of access owing to its wide availability.
However, despite its benefits and popularity, this trading instrument still has some major limitations. For example, CFD investment platforms are still unable to offer instruments with low investment costs and are mired by the complexity of currency exchange in some countries. They also carry high levels of risk and cannot currently be customized to the needs of an individual investor. Additionally, since the CFD industry lacks regulation, a broker’s credibility is based on his reputation rather than life span or financial position.
CSD's IPO signing was witnessed by HRH Tengku Puteri Datuk Paduka Seri Hajah Zahariah Binti Almarhum Sultan Salahuddin Abdul Aziz Shah (back row, centre)
Liberalizing Investment Channels
To mitigate these challenges, CSD has put together a cutting-edge blockchain-based online trading platform that will provide financial intermediary services for the trading of forex, CFD, shares and futures. The platform will also include flexible order placements, stop-loss prices, an easy view of transactions, sound alerts at price points, customized indicators, a smart trading system and a technical analysis platform.
Investors can utilize this affordable and accessible capital investment channel through CSD tokens, which can be acquired with fiat currencies or via digital currency exchanges. The tokens can also be obtained during CSD’s Initial Coin Offering (ICO) and be transferred onto the CFD trading platform by placing a trade order for a CFD product. The platform will then execute the trade order with the trader using the corresponding USDT (a cryptocurrency tethered to a fiat currency) capital pool. If investors wish to sell, they can simply instruct the platform and the corresponding USDT will be converted into CSD tokens and returned to them. Investors can either continue to hold the tokens or withdraw them in fiat currency through digital currency exchanges.
The use of CSD tokens will resolve the need for personalized investment portfolios and financial services for investors in Asia. Apart from breaking the financial barriers in Asia, its hedging characteristics also reduce the risks of high leverage during fluctuations.
A Formidable Future
CSD’s commitment to providing world-class wealth management and investment through blockchain technology and cryptocurrencies is evident by the waves it is already making. With an impending listing on NASDAQ later this year, CSD has emerged as the first Malaysian-owned company to host its Initial Public Offering (IPO) in the US. It has also gained validation with its team and advisors that comprise industry experts and entrepreneurs with in-depth knowledge of the financial industry, wealth management sector and cryptocurrencies. Significantly, the company is chaired by Her Royal Highness Tengku Puteri Datuk Paduka Seri Hajah Zahariah Binti Almarhum Sultan Salahuddin Abdul Aziz Shah, daughter of the late King of Malaysia, Sultan Salahuddin Abdul Aziz Shah Al-Haj Ibni Almarhum Sultan Hisamuddin Alam Shah Al-Haj.
While the company’s current short-term plans are focused on launching the CFD trading platform, its plans for the region are only getting started. With a promising IPO on the horizon, CSD remains committed to its vision of being thought leaders and creating unique solutions that will add real value to the new financial trading world.
This article was first published on the MillionaireAsia Issue 48 - June 2018