Yesterday Japanese company Recruit announced they’ve invested in the Provenance blockchain. Provenance is a loan platform developed by Mike Cagney, the controversial founder of student loan company SoFi which raised a billion from SoftBank. The announcement revealed that investment bank Jefferies is also an investor.
The Provenance blockchain is used to buy and sell loans, as well as managing loan repayments. It also provides proof of ownership and clarity concerning loan securities. The public permissioned blockchain relies on the “Hash” token.
Recruit, which has an annual turnover of over $19 billion, owns both Indeed and Glassdoor recruitment websites. The investment was made by Recruit’s investment arm, RSP Blockchain Tech Fund.
Recruit have identified the potential for the Provenance blockchain to disrupt the securitization market. Securitizing loans currently relies on intermediaries with the corresponding costs and time delays. Provenance aims to increase trust and transparency in the securitization markets by eliminating the need for third parties.
Recruit also projects that Provenance will break into other markets outside of loans and securitized loans. One of the first new areas is likely pooled investment vehicles. Provenance is onboarding a hedge fund which plans to move its custody and administration onto the platform.
At the end of the year, Provenance is planning to have a full IPO for its token – it doesn’t use the term security token offering. Figure is the company that developed Provenance and is liaising with the SEC re the IPO.
The RSP Blockchain Tech Fund has already invested in blockchain projects. It initially devoted $5 million to Israeli cryptocurrency Beam. The initiative supposedly provides a less energy-hungry Proof of Work (PoW).
Recruit’s blockchain fund also invested a maximum of $250,000 in blockchain startup COTI (Currency Of The Internet), which offers a fast and cost-effective payment system.
The RSP Blockchain Tech Fund was set up in Singapore last November, with an initial fund of $25 million. The blockchain fund invests in tokens rather than shares, which is the domain of Recruit’s venture capital arm Recruit Strategic Partners (RSP). RSP has made several blockchain investments, including into payments company Veem and cryptocurrency exchange bitFlyer.