Nasdaq opens the floodgates via $20mn investment round
In what looks like one of the biggest moves into crypto in 2019, Symbiont Inc got a $20 million cash injection from a Nasdaq-led funding round.
Even though this is one of Nasdaq’s most pronounced moves into crypto, they are not unfamiliar with digital assets. Some months ago, the Wall Street giant acquired the pro-crypto fintech company Cinnober for $190 million. Cinnober is known for its crypto affiliations as the fintech partnered with BitGo last year.
The investment marks the latest escalation in an arms race among traditional exchanges looking to capitalise on the budding technology that was once seen as an existential threat.
Rather than being cut-out by blockchain tech, which like Bitcoin offers the possibility of moving value without a trusted third party, Nasdaq is partnering with several companies, including Citi, Mike Novogratz’s Galaxy Digital and Raptor Group to study the technology and increasingly, to use it.
In an interview by Bloomberg, Symbiont CEO Mark Smith said: “We are entering a much more realistic phase where people look at this technology and think seriously about where it makes sense to apply it and where it doesn’t”.
He continued: “We are leaving the peak of the hype cycle and entering the trough of disillusionment, especially for people who inappropriately applied this technology hoping it would become a panacea for solving all their problems.”
Symbiont has developed its own blockchain and smart contract platform called Assembly. The platform is set to allow financial institutions to share and verify data via its pre-programmed agreements that determine how complex financial instruments will behave in a given scenario.
The use of blockchain technology in this closed system is meant to speed up settlement times for loans and improve efficiency in the mortgage bond market. At the same time, this is a far cry from the ideal of eliminating third-parties entirely, but many would say it’s a necessary next step (which is a contentious viewpoint).
According to the statement, Symbiont will use the cash to work on data management, mortgages, private equity and syndicated loans.
Nasdaq is expected to explore further opportunities to apply Assembly with existing clients that are looking to use smart contracts or tokenize assets – a process that involves representing real-world assets into digital contracts.