We felt that looking out in the crypto area that there are a lot of crypto exchanges out there and there’s a lot of institutions that are looking on to this space with interests but the problem was that it’s very hard for them to find credible venues to trade with. So what we’re trying to do is set-up an institutional grade credible venue in London and as part of that what we realized is that actually two of the issues for institutions are firstly they can’t find a credible counter party, but also cryptocurrency is difficult for them. Firstly they got a bit of a bad reputation, and secondly, as well, the venues on which they trade just don’t have the systems and processes in place for them to deal with.
So due to that and due to the product volatility they’re much more interested in security sanctions. Quite early on in our journey we said look, cryptocurrency is, well we have always said utility tech is just uninteresting for institutions and then not really interesting to us because of the value.
I think that cryptocurrency is themselves they could be interested but they’re not regulated in the UK at the moment we’re staying away from those and we’re focused fully on security tokens.
We invented the concept called, “KYA”. “KYA” is know your asset.
Know your asset.
The same way that “KYC”, know your client is the identity of a person, “KYA” is know-your-assets, the identity of the asset. And with “KYA”, you have all the documents relating to the...all the legal documents relating to the asset explaining what the asset is, what the rights of the token holders here. All of this is being packaged and added to the token, incorporated into the token so it goes with the token. On the block auction it’s immutable, nobody can change it, nobody can play with it.
And as a token buyer you can look at it and see exactly... what you are buying. That’s the first layer. The second layer is where the bankers come in because we think that it’s not enough to have just the information it needs to be verified. Can you do your own KYC? Can you say that I’m not a thief? You can’t, (laughing) somebody is… it’s to look at it.
In the same way when you are doing KYA and you saying things about your asset, we want to have underwriters…
… look at the asset and verify it.
I think that we’re trying to do at this point is glue the different parts that are necessary in the industry which mimic traditional markets. Right? So you’re talking about custody right. Custody is necessary for you to bring us institutional investors. After custody, you need to have legal teams that understand that compliance is necessary of issuing a security token on the blockchain.
What do you think is the biggest promise? You were talking about secondaries specifically for “LPs”. Do you see that just being the big sort of meat on the bone right now or is there something else that’s in this sort of security token space as a promise with it or is it sequential like we are going to start like you said, where the money already is, supply and demand, and then something else is going to come? Where do you see the big opportunities here?
Yeah. Yeah. So it’s funny actually we spoke it on our panel yesterday at Security Token Summit, and in my opinion, I think that we need to start where the market is and then afterwards we’ll see other players that will be tackling more alternative space like diamonds, and arts, and etcetera. But in terms of Rivver, we are hyper focused on funds and we’re not going anywhere. It is a niche comparatively to other players in the space but for us four trillion dollar niche is more than enough for us to be happy.
It’s a wide street to drive on.
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