Liquidity, Aggregators and the Secondary Market

The adoption of equity and debt crowdfunding has left most if not all policy makers and regulatory bodies challenged to find the right framework to properly regulate the array of platforms launching into the market. These platforms have given accredited and retail investors alike access to alternative investments they would not otherwise have. One area overlooked by most investors and now being addressed by regulatory bodies is investment liquidity.

The first regulatory commission to have an open sandbox discussion is the UK’s FCA. In the most recent “Call for Input”, liquidity was referenced a number of times within the review of lending based crowdfunding. Liquidity in equity crowdfunding has been a hot topic earlier in the year. This open conversation and eventual drafting of regulation will no doubt mirror how other countries solve this issue.

Crowd Valley’s close cooperation with the FCA and UK crowdfunding market already sees its clients utilizing the secondary market API developed in anticipation of the markets needs and potential regulatory policy. Other crowdfunding pioneers like Crowdcube have recently committed to providing increased liquidity and access to a secondary markets for their investors. We anticipate other countries like the US, Singapore, Malaysia, Japan and Canada to adopt similar framework in the near future.

This also opens up the opportunity for tertiary digital finance businesses to pair with existing platforms to aggregate their secondary market opportunities. There are already examples of data aggregators such as Deal Index in the market. With the personal view of great future opportunities in primary and secondary market deal aggregation being facilitated by the “API economy”.

If you are looking  to capitalise on collaboration within the fintech space, get in touch with us at Crowd Valley to leverage our full offering and industry leading Digital Back Office that bridge the gap into fintech.

Read the whole article on Crowd Valley News.