Tokyo-based bank Nomura Holdings Inc. (NYSE: NMR) has invested in Fnality, a blockchain-based interbank payment and settlement network that is now sponsored by 17 major financial institutions.
What Happened: After raising £50 million ($54 million) Series B funding in 2019, Fnality is in the process of raising a similar amount again.
“The transformation of financial services powered by blockchain technology is clearly accelerating, and we believe Fnality is uniquely positioned to capitalize on the significant opportunities brought by this evolution,” Angel Issa, global head of corporate development and strategic investments at Nomura, said.
"We look forward to leveraging Fnality’s technology and expertise to continue delivering differentiated value to our clients and partners globally," Issa added.
See Also: Nomura Forays Into Metaverse
Originally known as the Utility Settlement Coin, Fnality tokenizes funds deposited at a central bank and enables the settlement of DLT-based transactions with on-chain digital currency.
"We at Fnality are excited to draw on Nomura’s extensive experience in capital markets across Japan, the U.S., and Europe as we expand beyond the UK," Fnality CEO Rohomaios Ram said.
Fnality's other investors include Bank of New York Mellon (NYSE: NYSE:BK), Banco Santander (NYSE: BME:SAN), Barclays (LON:BARC) (NYSE: BCS), CIBC (NYSE: CM), Commerzbank (ETR:CBKG) (OTC: CRZBY), Credit Suisse (SIX:CSGN) (NYSE: CS), Euroclear, ING Groep (AS:INGA) (NYSE: ING), KBC Groep (EBR: KBC), Lloyds Banking Group (LON:LLOY) (NYSE: LYG), Mizuho Financial Group (NYSE: MFG), MUFG Group (NYSE: MUFG), Nasdaq Inc. (NASDAQ: NDAQ), SMBC, State Street (NYSE: NYSE:STT), and UBS Group (NYSE: UBS).
Why It Matters: After Mizuho, MUFG, and SMBC, Nomura is the fourth Japanese company to back Fnality.
Japan has emerged as one of the most successful countries when it comes to security token issuances.
Nomura, which has been active in the blockchain and capital markets for several years now, also founded Boostry, which offers a tokenization platform used for bonds and other securities. It also established Laser Digital Holdings, a company that deals in digital assets, in Switzerland.
What's Next: Since HM Treasury has formally recognized Fnality as a payments system, it is anticipated to introduce its first currency, the British Pound, next month, followed by Euros, U.S. dollars, Canadian dollars, and Japanese Yen.
Fnality is reportedly progressing with its digital euro effort, which was supported by an investment made by Euroclear earlier this year.
The necessity for settlement with cash on a ledger in central bank money will become more pressing as security token issuances progress further.
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