Decentralised Finance (DeFi) could hold the key to boosting digital financial services, such as payments, loans, remittances, funding, and insurance in Southeast Asia. DeFi is a system or service based on blockchain technology, which provides financial instruments that big banks and other financial institutions do not control. The region’s financial services sector can thrive and benefit the citizens by addressing the issues hampering its progress.

According to the Future of Southeast Asia’s Digital Financial Services Report by Bain & Company, Google, and Temasek, more than 70% of the adult population in SEA are underbanked or unbanked, and they use cash as their primary transaction tool. Moreover, the COVID-19 crisis pushed more people online, with the eConomy SEA report concluding that millions of new internet consumers came online with a desire to use digital services.


We take a closer look at NFT adoption in Southeast Asia


Furthermore, new businesses do not receive sufficient funding to sustain them. DeFi startups are filling the gaps left by the banks by providing access to financing and offering convenient digital payments and remittance services. Decentralised finance removes financial services fees, gives people control over their cash in a secure digital wallet, and money transfers are instant and easy to verify.

The DeFi trends in Southeast Asia indicate that the region can become a global hub for decentralised banking services. Research from Statista shows that Vietnam and Thailand held the second and third spot out of the 20 countries leading interaction with DeFi platforms globally from April 2019 and June 2021. In addition, the number of Southeast Asians using digital payments is likely to amount to 443.90 million by 2025.

Here are the top DeFi startups making their mark in SEA.

Coin98

Decentralised financial services provider, Coin98, offers a one-stop platform for cryptocurrency exchanges, blockchain-based games, lending, and other solutions. Its subsidiary Coin98 Labs helps people access DeFi services for investing, trading, and storing their money in digital wallets. The company has more than 700,000 users and has a trading volume of $500,000 USD.

Coin98 enables users to learn about blockchain technology and crypto through its Coin98 network. Its investment arm, Coin98 Ventures, funds builders involved in developing the DeFi ecosystem. Coin98 Exchange securely transmits transactions, meaning the user can send and receive funds safely to more than 150 countries and multiple blockchains.

The company has raised $16.5 million USD from investors, such as Hashed, Binance Labs, Genesis Block Ventures (GBV), IOSG Ventures, COINS GROUP and Christy Choi, amongst others.

Bholdus

Singaporean blockchain company Bholdus aims to solve traditional finance (TradFi) problems and decentralised finance by using cryptocurrencies, DeFi applications, and non-fungible tokens (NFTs). NFTs are blockchain-stored data units that are non-interchangeable, meaning they can act as online ownership IDs for digital assets. Owners of virtual items can use them as collateral for loans, sell or trade them online and earn crypto.

Unius Asia launched Bholdus, which has a transaction speed 400 times higher than other popular blockchains, to address the capital shortages startups face. Bholdus’ NFT issuance model can enable small and medium-sized enterprises (SMEs) in the DeFi space to raise funds for their businesses. Bholdus-native tokens (BHO) are valid for paying NFT transaction fees, ensuring companies in the Asia-Pacific (APAC) region can join the crypto ecosystem to trade and transact.

Ape Board

Thailand-based Ape Board is a cross-chain decentralised finance dashboard where users can monitor their DeFi activities and portfolio. The platform supports blockchain protocols, such as Binance Smart Chain (BSC), Ethereum, Terra, Harmony, Polygon, Arbitrum, and Solana. It has an NFT gallery for Ethereum and Terra. Ape Board has over 300,000 users, and they can check their net worth on the Ape Board dashboard, view claimable rewards, and check their total assets and debts.

Thus far, Ape Board has raised $1.2 million USD in seed funding from investors, including Spartan Capital, Defiance Capital, Long Hash Ventures, and Do Kwon. It also received money from SCB 10X, Siam Commercial Bank’s venture capital arm. The bank is providing $50 million USD to build DeFi infrastructure, improve user experience, and uncover actionable insights to boost both DeFi and TradFi.

The DeFi trends in Southeast Asia indicate that decentralised finance will grow in the coming years, giving the unbanked and underbanked in the region more access to the financial sector. The COVID-19 pandemic showed the vulnerability and volatility of financial markets and created the need for citizens to have greater control over their money. Governments are now meeting with stakeholders to provide inclusive economic policies and regulations, allowing the digital payments segment to flourish.

As the population numbers rise in Southeast Asia and people seek out online services, new DeFi startups will emerge to meet the demand for innovative digital solutions. The main challenge will be securing significant investment to advance DeFi in the region.