Japanese Financial Behemoth Nomura Invests in Payments Firm Fnality

Japanese banking giant Nomura has invested in Fnality, a global banking consortium focusing on developing a blockchain-based payment system to support the adoption of tokenized assets and marketplaces.

Nomura Invests in Blockchain Payment Firm Fnality

Nomura has invested in the London-based blockchain payments company Fnality, according to an announcement from Fnality on Monday. 

The financial services firm will also become a member of Fnality’s international consortium of global banks, which is working to develop a regulated, peer-to-peer payments system based on digital assets.

Fnality has already received backing from 16 major financial firms, including Banco Santander, BNY Mellon, Barclays, CIBC, Commerzbank, Credit Suisse, Euroclear, ING, KBC Group, Lloyds Banking Group, Mizuho Financial Group, MUFG Bank, Nasdaq, Sumitomo Mitsui Banking Corporation, State Street Corporation, and UBS.

Fnality, founded in 2019 and formerly known as Utility Settlement Coin (USC), intended to build a network of wholesale blockchain-based payment systems denominated in the U.S. dollar, the Canadian dollar, the euro, the British pound, and the yen. The tokenized currencies would be completely backed by fiat currency held by the corresponding central bank.

Reuters reported in September 2020 that the project’s bid for regulatory approval had encountered setbacks.

Fnality’s Fundraising Efforts

The terms of Nomura’s investment were not revealed. Fnality, on the other hand, intends to utilize the funding to extend its foothold in capital markets across Europe, the United States, and Japan, according to the company.

According to reports, Fnality is looking to raise £50 million ($53 million) in a Series B round, which represents the same amount it raised in a Series A round in June 2019, when the company became a commercial entity.

Nomura to Foster Crypto Adoption

The news of Nomura’s backing comes as the investment bank creates a new crypto VC arm under its digital assets business. The unit known as Laser Venture Capital will invest in startup categories such as DeFi and blockchain infrastructure.

Laser Venture Capital is the first product to be launched by Nomura’s new digital assets division, Laser Digital. The bank is planning two additional product launches, one geared toward secondary trading and the other toward investor products.

Steven Ashley and Jez Mohideen will serve as chairman and CEO of Nomura’s Laser Digital crypto business, respectively. Ashley has stepped down from his prior position as the head of the bank’s wholesale division in order to take on the new role.

In the same announcement on Monday, Angel Issa, Nomura’s global head of corporate development and strategic investments, stated:

“The transformation of financial services powered by blockchain technology is clearly accelerating, and we believe Fnality is uniquely positioned to capitalize on the significant opportunities brought by this evolution.”

Adding:

“We look forward to leveraging Fnality’s technology and expertise to continue delivering differentiated value to our clients and partners globally.”