Blockchain for Banking News

ANZ, Westpac, CBA blockchain bank guarantee platform raises $9.4m funding

anz bank

Today, Lygon, the blockchain-based bank guarantee platform backed by three of Australia’s biggest banks, ANZWestpac and Commonwealth Bank of Australia, said it raised a A$12.75m ($9.4m) oversubscribed funding round. Lygon was incorporated in late 2020, with the three banks as shareholders alongside the developer IBM and shopping mall company SCENTRE.

According to the Australian Financial Review, ANZ led the latest round, with up to 25% of the funding coming from staff, friends and family.

Bank guarantees are often required when organizations rent properties, ensuring that the rent will be paid even if the tenant cannot. Lygon digitizes the process, which has several advantages. It’s much faster and more efficient. In other countries, such as Italy, there have been significant problems with fraudulent guarantees where blockchain provides a solution by enabling authentication with digital signatures.

It uses the Hyperledger Fabric blockchain.

On incorporation, the company raised A$14.4 million ($10.6m) and another A$7.2 million ($5.32m) seed round in June 2021.

After starting to run pilots in 2017 and incorporating in late 2020, Lygon issued its first guarantee in February 2021 and now has half of the issuers signed up, with a target of 90% by the end of June. 

The funding will be used to expand its activities into the insurance sector and ESG. It also plans to get involved with mining rehabilitation bonds. If a miner fails to rehabilitate the land after mining an area, the state uses the rehabilitation bond to do so.

Meanwhile, blockchain has been used in other countries for similar purposes, such as Italy and Thailand.

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