Koine, a provider of segregated, institutional custody and settlement of digital assets founded in 2017, announced today it was granted authorization for the issuance of electronic money (EMI Licence) by the Financial Conduct Authority (FCA).
The EMI authorization allows for Koine to provide real-time e-Money payment services to the growing institutional client universe. Koine is also in the process of applying for a number of authorizations in other major financial services locations.
While it is linked to, and facilitates the custody and settlement model described below, these services are currently outside the UK regulatory perimeter and the e-Money authorization should not be read as authorization of Koine’s transformative custody and settlement model for digital assets.
This model eliminates settlement and counterparty risks by enforcing Delivery versus payment (DVP), while ensuring clients at all times retain beneficial ownership of their assets throughout the trade lifecycle.
Inspired by the best practices of world-famous traditional custodians, Koine has overcome the challenge of safekeeping and settlement of bearer instruments.
With more than 40 institutions, funds and family offices onboarded, Koine represents the culmination of two years’ governance, legal and technical programs to create an infrastructure suitable for institutional capital. It has engineered a unique solution that sets itself apart from the current hot wallet/cold store model with manual transfers, providing heightened security of assets, with instant settlements and withdrawals.
Leading the Koine team as CEO and Chairman is Hugh L. Hughes, ex-CEO of Société Générale Securities and co-founder of Fixnetix.
“Market reaction to Koine’s ultra-secure scalable institutional class solution for custody and settlement, has been immensely favorable, and with our EMI authorization now issued by the FCA, we are rapidly moving to implement the market infrastructure necessary to support institutional participation in the digital assets marketplace. The FCA’s recognition of the controls and processes that we have put in place for our EMI authorization, notwithstanding their concerns regarding the digital markets, shows that London can continue to attract financial institutions in the digital markets, alongside traditional capital markets, as long as those institutions can show that they have appropriate governance to address the regulator’s requirements.”
– Koine CEO and Chairman is Hugh L. Hughes