More recently, references to blockchain-based real-world assets (RWAS) are reminiscent of traditional financial institutions like BlackRock, accounting for more than billions of dollars in tokenized money market funds.
However, Crypto’s original promise was to open financial opportunities for everyone. It’s ETHOS where Bitfinex securities are sticking to the latest tokenized share issuance. Two alternative UK financial products, one focuses on community banking debts, and the other focuses on litigation related to false automotive finance claims.
The Bitfinex Securities “Titan1” product, announced Wednesday, will allocate £5 million ($6.8 million) to lower debt issued by Castle Community Bank, a company that helps lend to financially excluded customers in Edinburgh, Scotland.
This alternative debt product offers a 20% annual dividend (net of fees), according to a press release.
The second structure, Titan2, invests £100 million ($136 million) in litigation funds related to a misselling automobile financing claim in the UK.
The funds will be deployed through stock-related memos, and investors will receive 50% of the recovery revenue from claims that have been proportionally split between investors, Bitfinex Securities said.
Both lists are accessible to investors as tokens that can be traded through the Bitfinex Securities secondary market. The token is issued on Liquid Network, a Bitcoin sidechain developed by technology company Blockstream. In this blockstream, transfers require issuer approval, and the whitelisting system ensures compliance standards and jurisdiction requirements.
Looking back at the time, Bitfinex Securities’ foray into tokenized RWA has driven the current trends in blockchain-based financial assets issued by institutions such as BlackRock and Franklin Templeton a few years ahead.
The company has started with niche products like blockstream-linked tokenized Bitcoin mining hashrate agreements, then offered by El Salvador’s first tokenized US Treasury, bringing T-Bill investments to individuals and organizations who previously had no access to these products.
Jesse Knutson, Head of Business at Bitfinex Securities, has a philosophical view of current tokenization trends.
“We want to help people bridge that gap with investors,” Knutson said in an interview. “Whether it’s a company or a bond issue, what it is, it raises capital, fills that gap that remains in many parts of the world, and is not willing to lend, or people struggle to gain access to capital.”
Along with BlackRock and UK asset manager Schroeders, Knutson, fresh from the London digital assets panel, said there is an ecosystem bias towards bonds. The majority of the focus is on money market funds. There, he said, there are no many deals as people tend to buy and hold to get returns.
“The majority of this is about intermediation, and I think that’s something that institutional people just can’t get at all,” Knutson said. “If you look at the details of what they actually did, it’s usually left to right. It’s the same kind of people. It’s going through deposits and through transfer payment agents, which are the usual kind of part of the traditional ecosystem.
Read more: How the next wave of RWAS is at the real edge of Crypto
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