Tiger Brokers skip China for crypto services amidst crackdown by govt. Person looks at crypto trading prices on a mobile app

Tiger Brokers skip China for crypto services amidst crackdown by govt. Person looks at crypto trading prices on a mobile app (Photo by Nhac NGUYEN / AFP)

Tiger Brokers bypasses China for crypto but leverages Alibaba Cloud for DX

  • Chinese online brokerages plan to launch crypto services outside of mainland China
  • Alibaba Cloud’s services to boost Tiger Trade app; gains momentum in SEA
  • Asia set to climb to the top in the global digital economy

Tiger Brokers, together with China-based Futu, recently announced plans to launch cryptocurrency trading services to offshore clients and skip the Chinese market entirely. An understandable decision by these NASDAQ-listed e-brokers, considering how China is waging war on cryptocurrency activities on the mainland.

At the time of writing, Tiger Brokers claim they are applying for “relevant licenses” from regulators to trade crypto, though details of these remain unclear, reports SCMP. 

Tiger Brokers far from going broke

According to the Xiaomi-backed online brokerage, Q1 2021 performance for Tiger Brokers parent company UP Fintech Holding Ltd saw revenues of US$81.3 million, a whopping 255.5% increase from the previous year. During this period, the firm saw almost triple trading volume, in excess of USD$ 123.8 billion, over the same period last year. 

This comes hot on the heels of their collaboration with digital giant Alibaba Cloud to boost performance power on their online trading platform, Tiger Trade. With the increase in investors on their mobile platform, the infusion of Alibaba Cloud’s solutions will go towards optimizing data flow speed on the app, as well as provide valuable insights into investor behavior with their big data offerings. 

Alibaba Cloud and Chinese aggression

Alibaba Cloud has been zealously targeting the ASEAN region in recent times with its comprehensive cloud offerings, posing a substantial threat to stalwart rivals Amazon, Microsoft, and GoogleTheir recent moves have pushed them to overtake enterprise giant IBM on the global cloud leaderboard, even.

As the largest cloud service provider in Asia, Alibaba Cloud has enjoyed the ease of entry to emerging markets in SEA such as the Philippines, Indonesia, and MalaysiaTheir strategic investment of over 2 billion yuan (USD$ 283 million) in 2020 aims to position them as a global leader in cloud services, especially given the opportunities presented by Covid-19. 

The rise of Asian digital giants

Online brokerages such as Tiger Brokers and Futu have seen massive growth in recent years, paving the way for more Asian digital finance platforms to tap into the lucrative crypto market, although it would put them in direct competition with crypto industry exchanges like Robinhood and eToro. 

The prognosis for cryptocurrencies as sustainable alternative assets have been looking up, with even traditional finance giant Goldman Sachs recently u-turning on its previously negative sentiment on cryptocurrencies as a viable asset class.

The potential for transformative digital growth in Asia is large, especially since it comprises a large part of the Asia Pacific (APAC) market which is categorized as emerging. This positions the region to become the fastest-growing cloud computing market in the world. In addition, India and Indonesia are rapidly rising to become Asia’s largest digital economies, alongside China. 

Whilst many in Western markets are nervous about the overall presence of China in global markets, Asia has been especially receptive to big players from the mainland, such as Tencent and Alibaba. Not all is bright and cheery for Alibaba, however.

Arch technology nemesis Tencent has been gearing up to rival Alibaba’s cloud offerings in Asia. To up the ante, China’s AI and cloud provider Huawei closed its shutters just a year after opening, upping the intensity of the rivalry between the two Chinese digital giants.

Tencent, with its deep pockets, has set its sights on challenging US competitors in the hypercompetitive cloud market with a 5 billion yuan (US$70 billion) injection over the next five years

The Covid-19 factor

A massive 33% surge in demand for cloud services is due to the wildcard Covid-19, forcing most of the globe’s workforces into utilizing digital and cloud services as businesses scramble to get staff working from home. 

From healthcare to travel, cloud and digital services have seen a boom in demand – not just in Asia, but globally as well. As countries adapt and get comfortable with the ‘new normal’ in a landscape where physical distancing has become a mainstay, the demand for cloud and digital services is not likely to die out any time soon.