UK fintech startup Nivaura has tapped Microsoft's cloud technology to launch what it claims is the world's first blockchain-based investment product.
Nivaura registered, cleared and settled two Principal Protected Notes (PPN) linked to the FTSE 100 - one through the traditional clearing infrastructure and a second using an open public blockchain.
Nivaura CEO Avtar Sehra says that using the Ethereum blockchain will help firms launching investment products save money by reducing the need for middlemen and slashing the costs associated with post-trade registration, clearing and settlement.
Says Sehra: "Our system is completely automated, end-to-end. We track all the data, and the money flows in a compliant manner, executing the deal in a legal way and aligning with all regulations. It makes sense for issuers and investors."
The startup has received full FCA approval and says that it used Microsoft Azure because the platform also complies with the UK regulator's guidance.
While the note was executed using the public Ethereum blockchain, Nivaura has also previously executed bond instruments using the Bitcoin blockchain, and is working on adding Zcash and JP Morgan’s Quorum protocols.