Securrency Secures $17.65 Million to Deliver Blockchain-Based ETFs

Financial services technology infrastructure and products startup, Securrency has raised $17.65 million from a Series A funding round. The round was led by exchange-traded fund and exchange-traded product sponsor and asset manager WisdomTree Investments, Inc.

As announced in a press release published on January 7^th, WisdomTree has made this strategic investment because Securrency targets implementation of blockchain technology into the ETF ecosystem.

The Washington-based startup is one of the main developers of institutional-grade blockchain-based financial technology. Some of the other big investors who took part in the round are the Japanese financial services firm Monex Group, the Abu Dhabi Investment Office, and venture capital companies RRE Ventures, Panthera Capital Investments and Strawberry Creek Ventures.  

With this investment WisdomTree intends to push Securrency’s efforts in dealing with the challenges of tokenizing securities. A blockchain-based token grants wider accessibility and liquidity to investors but also brings challenges related to identity compliance all around the world.

The blockchain-based financial technology created by Securrency delivers a way to handle these challenges successfully and since the needed compliance components are built in the platform, it provides a more straightforward way for issuers to tokenize securities.

In an interview with International Business Times, Securrency co-founder and COO John Hensel disclosed:

“We are working very closely with them [WisdomTree] to deliver regulatory-compliant financial instruments that are representative of the asset types that they currently offer in the market and therefore bridging the legacy financial services environment to the distributed ledger environment.”

Jonathan Steinberg, WisdomTree Founder and CEO commented on the goal of their funding:

“Using the technology, we believe we have identified areas for exciting innovation within the ETF ecosystem and in financial services more broadly, all with a focus on meeting the highest standards of regulation.”

The Abu Dhabi Investment Office is the second biggest investor with $5.4 million. They believe that Securrency will be a vital growth element in Abu Dhabi’s digital asset space.

This year will bring a couple of alterations to the ETF market, such as the ETF Rule, which was settled in December by the U.S. Securities and Exchange Commission and allows ETFs that meet certain conditions to enter the market without the need of an exemptive order. Other changes are the new actively-managed ETFs and the dropping commission for retail trading.

It is expected that these changes will make the ETF market more competitive in 2020. For example WisdomTree’s effort to implement blockchain aims to increase its audience, which would affect the ETF ecosystem. It is a fact that technology will drive the competitiveness of the sector and 2020 promises to be an interesting one.