Japanese investment banking giant Nomura’s digital asset subsidiary, Laser Digital, has made a strategic investment in institutional-grade decentralized finance (DeFi) protocol Infinity Exchange, the firms announced Wednesday.
Neither Laser Digital nor Infinity disclosed details about the size of the investment or valuation.
Infinity is a hybrid lending and borrowing platform that combines blockchain-based, permissionless settlements with traditional finance (TradFi) processes and risk management. Founded by a Morgan Stanley alum, the protocol focuses on offering fixed and floating interest rate markets and crypto yield curve to institutional investors.
“Infinity’s groundwork paves the way for institutional flows on-chain, new levels of rates and risk innovation,” Olivier Dang, head of ventures at Laser, said in a statement.
The investment highlights a growing trend of merging crypto-native DeFi infrastructure and TradFi solutions to enable the tokenization of assets such as credit and creating blockchain-based markets for institutional investors.
The Bank for International Settlements’ (BIS) latest crypto guidelines gave the asset tokenization trend some tailwind, according to the press release. Starting in 2025, tokenized traditional assets will be subject to the same risk weight as their original counterparts in the banking books, according to the BIS guidelines.
“With US$300 trillion of credit securities outstanding and multiples of that in the loan, derivative, and equity markets, the new guidelines portend a major wave of tokenization across financial and real assets,” the press release said.
The investment follows Infinity’s $4.2 million seed funding round, with trading heavyweights such as CMS, GSR and Susquehanna among the investors.
CORRECTION (Feb 15, 09:44 UTC): Corrects spelling of Infinity throughout. An earlier version spelled it as Infiniti.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.