Capital markets News

Tokenized securities platform iSTOX attracts Japanese government backed investors

tokenized securities

Today iSTOX disclosed that it extended its Series A funding round with investment from the venture arm of the Japanese Investment Corporation (JIC-VGI) and the Development Bank of Japan (DBJ). Other new investors include Japan’s Juroku Bank and Mobile Internet Capital (MIC). This brings the total Series A funding to $50 million.

iSTOX’s platform is already in production, offering investments in real estate funds, hedge funds, bonds and other securities. Together with other backers and partnerships, iSTOX is positioning itself as a pan Asian digital assets provider. 

Existing investors Singapore Exchange (SGX), Japan’s Tokai Tokyo Financial Holdings and Korea’s Hanwha Asset Management also upped their investment. Other existing investors are Heliconia Capital Management, a subsidiary of Singapore state-backed Temasek Holdings and Thailand’s Kiatnaking Phatra Financial Group.

The company is licensed for digital asset issuance, custody and trading by the Monetary Authority of Singapore.

One of the countries missing from its Asian roster of investors is China. In November 2020, it signed an agreement with the Chongqing Monetary Authority to create a digital securities exchange in Chongqing for the Chinese market. 

Also last year, together with Tokai Tokyo Financial, iSTOX invested in a blockchain tokenization development company, Hash Dash Holdings.

“iSTOX will expand our footprint both geographically and in terms of investment offerings. We will roll out private issuances by blue-chip issuers that individual investors on our platform can subscribe to in bite-size portions,” said Oi Yee Choo, Chief Commercial Officer of iSTOX.

The iSTOX platform leverages smart contracts and blockchain to streamline the issuance and trading of digital securities and connects investors and issuers directly. This significantly reduces the time and cost of managing digital securities while providing more investment options. iSTOX estimates this cost reduction reduces the minimum investment amount to $20,000 or less from the typical $1 million required for private markets.

Meanwhile, there are multiple initiatives in Japan exploring security tokens. Nomura and Nomura Research founded  BOOSTRY and its ibet tokenization platform, in which SBI  subsequently invested. Securitize Japan is working with NTT Data on a compliant security token platform and with LIFULL on a real estate tokenization platform.