Unique technology automates compliance by embedding identity, risk, security, transaction, and liquidity rules into tokens
Securrency predicts that over the next decade, financial institutions will go all-in to tokenize regulated assets
Securrency, a leading developer of institutional grade, blockchain-based financial and regulatory technology, today announced that it has received a United States patent for its Compliance Aware Token® Framework (CATF). This framework is a critical step in Securrency’s four-phase vision that includes:
- Tokenizing financial assets at scale
- Interconnecting global marketplaces on universal transaction and compliance rails
- Accelerating decentralized finance by combining powerful smart contracts with automated business logic
- Enabling a global, liquid digital assets marketplace available to all
In landmark pilot projects with global regulatory agencies and in commercial deployments with world-class financial institutions, Securrency has demonstrated how CATF can solve some of the most pressing issues for digital assets by allowing issuers, their agents, and intermediaries to:
- Easily build rule sets into a token for: identity authentication and authorization, securities regulations, and transaction and liquidity requirements
- Automate multi-jurisdictional compliance and risk-management functions, such as preventing fraud, enforcing holding periods, and applying trading volume and collateralization rules
- Repeat and reuse rule sets to streamline compliant digital asset creation and issuance
- Audit rule sets to facilitate reporting on tokenized securities offerings
- Empower authorized individuals or entities to freeze or claw-back tokens from a user wallet in, for example, a tax, bankruptcy, or criminal proceeding
Dan Doney, CEO of Securrency, said: “A massive wave of regulated asset tokenization is fast approaching. Basic tokenization without sophisticated, automated compliance isn’t going to cut it when it comes to equities, public funds, fixed income products, and fiat currencies. Financial service providers will need to implement tokenization solutions that encompass identity, security, risk, transaction, and liquidity rules to succeed in a digital assets market that is expected to reach over $16 trillion by 2030. This requires new ways to scale compliance, and our patented Compliance Aware Token Framework will be the foundation for achieving this critical industry milestone.”
Jonathan Steinberg, CEO, WisdomTree, said: “We expect all financial assets to eventually move onto blockchain infrastructure. As first-movers, WisdomTree and Securrency are focused on leading the way with a sophisticated, compliance-centered approach to blockchain-enabled financial products and services as we create the digital marketplaces of the future.”
Nadine Chakar, EVP, State Street said: “Compliance is fundamental to the evolution of digital assets as it will expand global access to capital and investments, help with institutional adoption, and allow for appropriate regulations. As an early investor in Securrency, we saw the potential of the company’s compliance technology as a key element in State Street’s digital asset strategy.”
Securrency’s Compliance Aware Token® Framework simplifies critical functions like custody, transfer agency, and regulatory compliance and is enabled by four key components of Securrency’s Capital Markets Platform:
- Identity Services support fast on-boarding and authenticate investors based on flexible third party credentialing systems such as Anti-Money Laundering (AML), Know-Your-Customer (KYC), and Know-Your-Business (KYB), using an open identity-proofing approach
- Attestation Registry provides real-time, risk-based authorization for market participants to engage in transactions for which they are properly credentialed based on factors such as their location and regulatory requirements
- Policy Rules Engine provides real-time representation of cross jurisdictional, asset-specific, and dynamically configurable policies through an intuitive, user-friendly interface so compliance can be embedded in every transaction through smart contracts
- Compliance Oracle enables tokens to reference encoded rules and regulations, ensuring that a tokenized or digital asset may only be transacted in accordance with specified policies
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