Fineqia International Inc. announced on Wednesday that its subsidiary Fineqia Limited had partnered with Nivaura Limited to launch tokenized bonds in the UK.
The two companies will be working together to launch fully automated tokenized bond issuance and administration on Nivaura’s white label capital markets platform.
Using Ethereum for Bond Offerings
The fully automated bonds will be registered and cleared on the public Ethereum blockchain.
The tokenized bonds will be a test for issuing crypto asset-backed bonds.
Fineqia Limited have to do the test as part of the UK Financial Conduct Authority (FCA) Sandbox Regulatory Program which was announced in July last year.
The program accepted 29 out of 69 applications that met the FCA’s criteria.
It is set to take place in the first quarter of this year, and the results will also be available in Q1.
The offering will enable crypto holders to borrow funds in fiat through the issuance of bonds backed by crypto assets.
The product has appealed to institutional investors, like funds, exchanges, and miners who demand liquidity but would rather not part with their cryptocurrency holdings.
Using Nivaura Technology to Issue Bonds
Nivaura’s technology will play a crucial role in launching these tokenized bonds for institutional investors.
These transferable fiat denominated bonds will be made available for fixed durations and coupons.
Bundeep Singh Rangar, Fineqia CEO commented on the partnership, saying:
“Nivaura’s advanced technology is an enabler of financial transaction lifecycle efficiency and is why we chose to invest in the company last year. It gives the Fineqia platform a simple transaction management workflow with a seamless blockchain-based asset registration and clearing solution.”
Fineqia invested in Nivaura in January 2018 and holds a minority equity interest in the company.