It brings us great pleasure to interview Luc Falempin, CEO of our partner Tokeny Solutions. In this interview we dive into all things Tokeny, including the need a compliant tokenization platform, The FinTech 50 Awards, Latest U.K. Regulation, The Tokeny Pipeline & EuroNext Partnership, Tokeny’s T-Rex Platform, and the future of Tokeny Solutions.
Q: Tokeny has been crushing it lately! What has your team been focused on and how do you execute so well?
A: From the day we started our business we always had the vision of tokenizing securities. The makeup of our executive team symbolises this as we have a blend of experience from financial markets whilst complementing this knowledge with technology expertise. We were the first live platform within Europe so as a consequence we are more advanced than other technology providers. We’re also very clear about our positioning in the market, we’re solely a technology firm, so our partners that include marketplaces, multi-issuers, investment banks etc, know that we do not compete with them, but instead, provide them with the blockchain layer they need so they can build and create better solutions for their customers.
Q: Tell us more about the FinTech 50 Award and the conferences Tokeny has been impacting this past year
A: We were truly proud to be included in this list. Just a year ago our client, Mash, was included in the 2018 edition and we’re very pleased to join them in this community. I think it just goes to show that blockchain technology and its application to capital markets is becoming more and more accepted amongst traditional and mainstream players. The award ceremony took place at Standard Chartered’s offices in London. This notion is reinforced by the types of events we’ve been invited to speak at from the likes of State Street, Ashurst, ALFI and many more to come. We’ve active at more technology focused events such as Consensus in Singapore and Devcon in Tokyo. We’re very aware that events are a great way to educate the market, and this is of utmost importance in such a nascent market.
Q: What can you tell us about the projects or structures Tokeny has in the pipeline?
A: We’ve been working more and more with institutional clients and have developed a suite of solutions to suit their needs. On a technology angle, we realised for large scale businesses to adopt this technology they need a system to identify market participants in order to apply their rights and duties. There are many complications in this industry. For example, KYC obligations are duplicated every time an investor wants to participate in an offering leading to long and expensive processes. Inaccuracies can also result from human error and from firms working from siloed ledgers. By creating onchainID and opening it to the market, we have a system that utilises distributed ledger technology and enables institutions to alleviate these problems by allowing information to be shared across permissioned users. The permissioning of this is significant as the data is sensitive so we ensure the information is encrypted. Only the parties with the required access can view the information. onchainID is essentially a global identity system that empowers data owners with the control they need so they can give and revoke access as they please.
In terms of the projects we are working with, real estate is a key driver for us and we recently announced Property Token. This asset class faces challenges and tokenization brings solutions. As I mentioned before, tokenization brings automation to slow and costly KYC process we see today. Also, the asset is illiquid and investors are limited as private market opportunities are typically only presented to those with close proximity. Tokenization resolves these challenges through features such as fractionalization, transferability and distribution, and it’s a win-win for both the investor and issuer. For sure, real estate has been the winner so far, but other projects, especially closed-end funds, don’t lag far behind.
Q: How is your relationship developing with EuroNext and what guidance has their team brought to the progress?
A: Very well, there are many areas of collaboration with them and we will have some announcements to come in the next six to twelve months. At the moment we’re able to lean on their resources and expertise in financial markets. On our side we can offer insight and valuable information on how this cutting edge technology works. Together we make a great partnership as we represent the best of both worlds.
Q: What can you tell us about the T-REX platform and what uses or advantages does it have over leading technology setups?
A: T-REX is the only protocol using onchain identities to enforce compliance. A wallet is not an identity and issuers using the whitelisting of wallets can potentially get into trouble in the upcoming years, like the SEC is chasing ICOs now. The validator (offering rules and investor rules via identities) is built-in and onchain. So we are not only providing permissioned tokens like others, we are also providing the validator to our customers, and they get the full control, so it’s a complete compliance system. It comes with the full stack of tools, the token factory, the servicing, and the onchain identities. It is not a static protocol either, and we are aware as the market changes our services do too. We have recently updated the T-REX which enables new features such as a single transaction securities recovery process and updating it to meet Ethereum’s new standards.
Q: How has the regulatory progress developed in the UK and do you see any leniency coming our way?
A: Considering how much the UK has had on its plate with Brexit, the FCA has been quite progressive and proactive. They’ve given a clear statement that STOs are regulated and should be managed with the exact same considerations as financial securities. This has given a lot of actors confidence in the UK to utilise this technology. Once Brexit settles, I expect the UK to be even more proactive and begin to announce initiatives that encourage using distributed ledger technology. We’ve just joined Innovate Finance, a UK government-backed organisation that’s committed to driving the FinTech revolution in Britain. We’re looking forward to developing this relationship further and being a part of the evolution in the UK.
Q: What are some industry pending challenges you see today that will be ironed out by the end of 2020?
A: A big barrier is still education. This is why we attend many conferences and deliver workshops particularly with financial institutions, so we can give our insights on how we see this technology revolutionising traditional markets. However, these markets are not small and they are incredibly complex, so it will take time. We can utilise our experience in finance, our partnership with Euronext and apply our experience to this technology. We also have some exciting use cases that we will be sharing so we hope we are doing our bit in driving awareness in the industry.
Q: Where do you aim to see Tokeny this time next year?
A: By next year we will have delivered our full-stack technology to some of the innovative financial institutions globally. We are getting a lot of traction with these types of players and we’re very excited to play a key role in helping these firms step into the new era of finance. We’re also looking to further cement our position as the leading tokenization platform in Europe and beyond. We made a step into expanding our reach in Asia Pacific and we recently hired Heslin Kim, who is heading up our business development operation in the region, so we’re looking forward to having more of a strong-hold in that market too.
Q: Where can we learn more about Tokeny?
A: I recommend subscribing to the following links:
A big thank you to Mr. Luc Falempin for his time to bring us these informative answers.
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