20|30, a blockchain venture studio company, announced that it has become the first UK company to successfully complete the tokenization and issuance of their equity as part of the UK Financial Conduct Authority’s (FCA) Sandbox 4, in collaboration with London Stock Exchange Group.
The test issuance was executed by TokenFactory, a capital raising platform, and the first 20|30 portfolio product to go to market.
This test happened in partnership with tech company Nivaura, who acted as custodian for the offering. Nivaura recently raised £20 million in a seed funding round led by London Stock Exchange Group. Other investors in Nivaura include leading law firms Allen & Overy, Linklaters, and Orrick.
London Stock Exchange Group participated in the test issuance by sending settlement instructions to a public blockchain via 20|30’s platform which is powered by Nivaura technology. The test, therefore, demonstrated connectivity between a regulated trading venue, the Turquoise Plato platform, and public blockchain infrastructure.
Founder & CEO of 20|30, Tomer Sofinzon, spoke about the impact of this new financial instrument:
“We have succeeded in what we hope is the first step in reinventing capital markets. By tokenizing our own equity at 20|30 through TokenFactory, we can demonstrate that there is a far better way to unlock the value of equity, built on innovative blockchain technology which will transform the way companies raise capital. Tokenisation will unlock value in a whole range of assets, from existing shares to new issuance, bonds, property, IP, fine art and much more.”
As a regulated, full-service fundraising machine, TokenFactory empowers investors with greater access to investment opportunities and to liquidity, while companies can raise capital more cheaply than traditional methods and in a time-efficient manner. TokenFactory will tokenize equity in a way that is compliant with UK laws and regulations. This is one of the few models of tokenization that can be scaled with ease, and differs from digitized uncertificated shares, an approach adopted by a number of other companies that do not necessarily provide the same legal certainty.
The test issuance was executed within the FCA’s Sandbox Cohort 4. Upon the closing of this issuance and initial funding round, TokenFactory will aim to remove its Sandbox restrictions to be a fully authorized MiFID investment firm able to arrange the issuance of equity tokens by global firms launching issuances in the UK.