Chapmans backs mission to solve blockchain’s ‘biggest problem’
ASX-listed venture capitalist Chapmans is putting its money behind Canadian tech play Securrency to solve what it says is blockchain’s biggest problem.
The unlisted company has created an exchange platform on which assets can be tokenised and traded — with compliance and regulation governed through the blockchain.
Securrency also own 35 per cent of the recently launched London Football Exchange – which is advised by FatFish Internet Group (ASX:FFG).
Blockchain technology, which provides an encrypted, public ledger of transactions, is best known as the basis of cryptocurrencies such as bitcoin. But it has many other potential applications such as enforcing digital contracts and securing public records.
About $150 million was spent on blockchain technology in the Asia Pacific last year, but that’s expected to exceed $280 million this year reports IT analyst IDC.
“The blockchain sector is plagued by a lack of jurisdictional compliance and verifiable security practices,” Chapmans told investors. This was the technology’s “biggest problem”.
“Many of the recent Initial Coin Offerings (ICOs) are not sufficiently vetted and no easy way exists to make them comply with regulatory requirements. This limits the blockchain sector’s market capitalisation as institutional money cannot participate in unregulated offerings.”
To address that, Securrency provides global identity verification, financial fraud monitoring as well as reporting of anti-money laundering, tax and regulatory requirements
Chapmans (ASX:CHP) has committed $US4 million ($5.1 million) to the company, paid in $1 million monthly instalments as it works towards listing on the Canadian TSX Ventures Exchange.
Chapmans shares were steady at 1c on Monday. Its market cap is $9 million.
Securrency owns 35 per cent of the recently launched London Football Exchange – to which FatFish Internet Group (ASX:FFG) is a blockchain advisor – and says it has numerous customers including a large private equity firm and a major Wall St firm.
“The investment in a platform which brings 24/7 trading and liquidity to asset and securities markets with much-needed regulatory compliance to the blockchain sector aligns with our commitment to investing in emerging technologies with opportunities for fast growth,” CHP chief Anthony Dunlop told the market.
This latest investment is part of a deliberate movement towards blockchain stocks – first through a $1 million investment in REFFIND last year – which prompted the establishment of a Blockchain Advisory Board.