London Stock Exchange Invests in Blockchain Bond Technology

London Stock Exchange Invests in Blockchain Bond Technology

The latest funding round by London fintech startup Nivaura has attracted $20 million in investment from major industry players such as the London Stock Exchange Group (LSEG) and Banco Santander’s investment division, Santander InnoVentures.

Nivaura describes itself as the developer of the world’s first crypto-denominated and blockchain-based bond settlement technology.

Blockchain Agnostic

In November 2017, Nivaura and JP Morgan created the initial bond for LuxDeco, a luxury goods dealer, under regulatory oversight from the UK’s Financial Conduct Authority (FCA).

By using the Ethereum-denominated bond, the intent was to demonstrate how lead-in times could be shortened, costs reduced and how it is possible to widen the availability to both potential issuers and purchasers with smaller investment capabilities.

The success of the project was followed the following summer by the World Bank who issued the first blockchain-based global bond through the Commonwealth Bank of Australia (CBA).

Despite using Ethereum for the original bond, Nivaura itself is blockchain-agnostic and, as stated on its website, works towards providing clearing and settlement networks to tokenise securities which can be “settled on chain either using tokenised fiat currency (a stable coin) or using a blockchain’s native cryptocurrency (e.g ether or bitcoin).”

In conjunction with the latest investment, the Chief Executive of London Stock Exchange PLC, Nikhil Rathi, along with HSBC investment banker Spencer Lake will join Nivaura’s board of directors.

Speaking to the Independent, Nivaura’s Avtar Sehra said that their current focus “…is on conducting a series of high profile, large-scale projects with high calibre partners to demonstrate our platform as a valuable solution across the full spectrum of capital markets primary issuance activities.”