Yesterday, blockchain company Axoni announced that it had closed $ 31 million in funding from new investors including Deutsche Bank, Intel Capital, and UBS, bringing total funding to $ 90 million. Existing investors also attended, including Citi, Goldman Sachs, HSBC, JP Morgan, Nyca Partners and Wells Fargo.
Axoni’s founders are likely cash rich right now. Back in 2013, they founded TradeBlock, a cryptocurrency analysis company that provides price data, including XBX for Bitcoin. For example, the Grayscale Bitcoin Trust uses XBX for pricing. Grayscale sister company Coindesk acquired TradeBlock in January.
Axonis technology is an adapted version of the Ethereum blockchain.
“Citi continues to embrace new technology solutions that improve the end-to-end customer experience, reduce risk, and achieve operational efficiency. We are excited to continue to support and work with Axoni to develop post-trade solutions, advance common standards, and bring significant value to the industry, ”said Puneet Singhvi, Head of Financial Markets Infrastructure and Blockchain Lead at Citi.
Axoni is involved in numerous large capital market projects, many of them in the derivatives area. The global derivatives market is three times the size of the stocks and bonds markets combined.
The largest and oldest project is the DTCC, where Axoni provided its technology for the updated TIW (Trade Information Warehouse) platform for credit derivatives.
The updated TIW platform was originally supposed to launch in 2019, but has not yet gone online. Given that TIW processes $ 9.9 trillion in settled and bilateral derivatives, it would need to be bulletproof to get started.
Another derivative project concerns equity swaps. This solution went live last year with 15 sell and buy-side companies, including City and Goldman Sachs.
More recently, Axoni has partnered with OCC, the world’s largest clearing organization for equity derivatives. Last year the company processed 7.52 billion contracts, serving Nasdaq, the NYSE and CBOE. OCC acts as the central counterparty for securities lending and aims to replace the securities lending infrastructure with the distributed ledger technology (DLT) operated by Axoni.
There is a fourth project for a banking consortium called DirectBooks, which aims to eliminate friction losses when issuing securities. Axoni is a partner in workflows for corporate bond issuance, an area where there are numerous blockchain projects. Some of Axonis’ supporters are DirectBooks subscribers, including Citi, Goldman Sachs, JP Morgan, and Wells Fargo.