DelphX Provides Industry Update and Product Launch Schedule

February 14, 2022

Toronto, Ontario–(Newsfile Corp. – February 14, 2022) – DelphX Capital Markets Inc. (TSXV: DELX) (OTCQB: DPXCF) (“DelphX“) is providing the following outlook on the structured products industry and the upcoming launch of its proprietary products to serve this multi-trillion-dollar space. Today’s commentary is in response to significant recent activity in the global financial markets directly connected to the DelphX business model.

Structured Products Industry Outlook

During its multi-year platform development effort, DelphX has established working relationships with regulators, buy and sell-side participants, dealers, and other parties uniquely positioned to monitor trends in the structured products markets. For those who follow these markets carefully, the Financial Times and other major publications, supported by International Swaps and Derivatives Association (ISDA) data, have begun to report a sharp multi-year increase in trading connected to low-rated credit default swaps. This surge in activity has also been accompanied by increased selling of U.S. High Yield Bonds and other indicators of rising risk aversion.

While very early in this cycle, these are exactly the kind of conditions that DelphX has developed products to address. Accordingly, with the growing sensitivity to risk in this rising rate environment, we have seen a sharp increase in interest in our product offerings from a broad range of industry participants and partnership contacts. Our recent announcement of the signing of BNY Mellon as custodian was in direct response to this combination of favorable market trends and escalating high-level discussions with potential customers. With continued rate increases expected across the globe, we believe these favorable market conditions will heighten the need for our products throughout 2022.

Launch Schedule

Based on these positive market trends and heightened customer interest, we are pleased to report that we have advanced discussions with counterparties to initiate trading in our proprietary products as part of a controlled launch of our platform. Though the transaction size and trade date are not yet set, our goal is to have these first issuances executed before the close of the current quarter (March 31st). The number of initial participants will be controlled during this launch phase, with a goal to expand participation in subsequent months.

“We have been working on our novel solutions to enhance yield and protect against risk in the credit market for a very long time, but to have market conditions so favorable at the time of our launch makes this milestone even more significant,” said DelphX CEO Patrick Wood. “The need for our type of solutions never goes away, but there are periods when risk and/or yield become very significant issues for institutions that trade and hold large bond portfolios. Every financial trend on our horizon points to a period of extended sensitivity to these dual issues that we help address, so the timing of our launch could not be better. With counterparties to be soon in place and some final measures to be completed before our first issuances, we are excited to have the opportunity to replace our theoretical models with real trades and outcomes in the very near future.”

About DelphX:

DelphX is a technology and financial services company focused on developing and distributing the next generation of structured products. Through its special purpose vehicle Quantem and its broker-dealer DelphX Services Corp, it enables fixed income dealers to offer new private placement securities that optimally transfer and diffuse credit risk, while allowing the enhancement of yield. The new DelphX securities will enable dealers and Qualified Institutional Investors (QIBs) to competitively structure, sell and make markets in:

  • Collateralized Put Options (CPOs) that provide secured default protection for underlying corporate, municipal and sovereign securities, and
  • Collateralized Reference Notes (CRNs) that enable credit investors to take on the default exposure of an underlying security in exchange for enhanced yield.

All CPOs and CRNs are fully collateralized and held in custody by an independent custodian. CPOs and CRNs are proprietary products created and owned by DelphX Capital Markets Inc.

For more information about DelphX, please visit www.delphx.com.

Contact:

Mark Forney, Corporate Development
DelphX Capital Markets Inc.
[email protected]

Forward-Looking Statements

This news release contains certain “forward-looking statements” including, without limitation, statements regarding the launch of the DelphX platform. Such forward-looking statements involve risks and uncertainties, both known and unknown, that may cause actual results or events to be materially different from those expressed or implied by such forward-looking statements, including but not limited to, business, economic and capital market conditions, the ability to manage our operating expenses, regulatory uncertainties, market conditions and the demand for our products. The forward-looking statements in this news release are based on factors and assumptions regarding, among other things, the state of the capital markets, the ability of DelphX to successfully manage the risks inherent in pursuing business opportunities in the financial services industry, and the ability of DelphX to obtain qualified staff, equipment and services in a timely and cost-efficient manner to develop its business. Any forward-looking statement reflects information available to DelphX as of the date of this news release and, except as may be required by applicable laws, DelphX undertakes no intent or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or results or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/113610