Capital markets News

WSFS provider Intain launches tokenized asset backed security marketplace on Avalanche blockchain

securities blockchain

Intain has launched its IntainMARKETS solution on the Avalanche public blockchain enabling a tokenized marketplace for structured finance products. 

The company already has its IntainADMIN servicing solution for asset backed securities (ABS), including mortgage backed securities. Its clients include the fourth biggest trustee in the ABS sector, WSFS Bank, as well as UMB, which both use Intain to provide Paying Agent services. Wilmington Trust is a new client. 

Intain cloned its admin solution that services $5.5 billion in assets from the Hyperledger Fabric blockchain to the Avalanche public blockchain. 

However, the Avalanche solution is on a permissioned subnet, giving Intain and its clients control over who can access the network and view transactions. The validators are selected by (sub)network participants, so it’s possible to require a validator to hold a license. The subnet doesn’t require the use of a public token.

Asset backed securities can be quite complex, with multiple tranches split according to investor risk appetite. Combined with the duration of the security, which can be seven to 15 years, this makes it a messy class of assets to monitor and report on. It’s also relatively expensive if done conventionally.

Hence the need for automation, which is where IntainADMIN comes in. And automation means that instead of having a minimum ABS transaction size of $100 million, this can be radically reduced to less than a tenth. With the launch of IntainMARKETS, the ABS tokens are underpinned by on-chain administration.

One interesting aspect is the potential for settlement. While it uses conventional payments at this stage, Intain is exploring the Regulated Liability Network and the most viable short term solution, the USDC stablecoin.

Intain is not the first tokenized ABS solution, but it just might have the largest scale in the United States. Liquid Mortgage also provides payment data for mortgage backed securities and uses public blockchain. And Figure Technologies has issued its own tokenized ABS for mortgages on the Provenance blockchain which was spun out of Figure.

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