UK-based equity and debt securities platform Fineqia has announced they are partnering with Nivaura to issue tokenized bonds. The tokenization of these bonds will be tested on the the public Ethereum blockchain.
We’ve spoken much about tokenized securities, but the bond market is one sector that has been left relatively untouched by the tokenization efforts happening behind-the-scenes. A UK-based company, Fineqia, is now looking to fill this gap through the use of their existing equity and debt securities platform by partnering with Nivaura, a fintech solutions company focused on the management of digital securities.
The partnership’s goal will be to “perform a fully automated tokenized bond issuance and administration, registered and cleared on a public Ethereum blockchain, to conduct its test for issuing crypto asset-backed bonds in the UK.”
A New Platform for Tokenized Bonds?
Fineqia will be providing the software to Nivaura to accompany the tokenized bond issuance. The first test will be conducted during Q1 of this year.
In mid-2018, Fineqia announced an investment in Nivaura so the partnership comes as no surprise. During that time they also invested in Digital Currency Group (DCG) and the London-based Allen & Overy, an international law firm.
The collaborative platform will enable cryptocurrency owners to issue tokenzied bonds via borrowed fiat. Fineqia is already able to facilitate traditional bond issuances and is now looking to expand to the blockchain space.
The bond market is still an area where tokenization is seldom talked about although the World Bank did issue its first blockchain-based bond back in August of 2018. The situation in the United States regarding tokenized bonds remains unclear, but the UK market is seemingly more receptive to this exciting idea.
What do you think about the announced partnership? Would bonds benefit from tokenization? Let us know your thoughts in the comments.