Intain backed by JAM FINTOP, Avalanche fund Blizzard for blockchain securitization – Ledger Insights

Blockchain startup Intain announced a funding round from Blizzard, a venture fund backing the public blockchain Avalanche, and JAM FINTOP Blockchain, a community bank-affiliated fund.

Intain initially focused on servicing conventional loan securitisations and in 2020 entered into a partnership with the fourth largest asset-backed securities trustee, WSFS Institutional Services. Nearly $5 billion in assets are currently managed on the Intain ADMIN platform. Now it additionally plans to launch a tokenization service.

Solve a pain point

The blockchain solution solves a major pain point in managing these securities, which take anywhere from seven to 15 years to manage. Although it has been almost 15 years since the Great Financial Crisis, there is no major centralized service to monitor and report on how individual loans in a pool are performing. This implies that securitization participants do not want to rely on a centralized body.

As a result, the report is usually at least six weeks late and maintenance is personnel-intensive.

In addition, most securitizations have many different investor classes divided by risk appetite, making reporting more complex.

In addition to the different types of investors, there are several stakeholders such as the lender, the loan payment servicer, the trustee, the issuer and the rating agency. It is the classic need for a single “source of truth”.

The Intain ADMIN solution automates most of the maintenance process. Instead of having a minimum transaction size of $100 million for securitisations, it is now possible to have a transaction that is a tenth the size.

“The fact that some of the intermediaries in the industry are willing to share up to 50% of their fees with us means that at least 70-80% of the transaction needs to be automated,” said Siddhartha, founder and CEO of Intain during a Hyperledger presentation.

The Intain ADMIN solution is based on Hyperledger Fabric. But it was cloned on Avalanche to launch a tokenization service, Intain MARKETS for Asset Backed Securities (ABS).

“We are not creating a new asset class, nor are we offering risk-free returns of 15% APY,” Siddhartha said, alluding to the claims of some now-bankrupt crypto lenders. “We are building a transparent and efficient version of the existing financial system.”

Avalanche was chosen for its DeFi focus and subnet (subnet) architecture, which supports permitted scopes that restrict access to financial institutions.

“Each subnet can be tailored to the precise needs of the application, including customizable gas rates, economics, validator sets, KYC requirements and more,” said Lydia Chiu, VP of Business Development at Ava Labs, on behalf of the Blizzard Fund.

Meanwhile, Intain isn’t the only one focusing on securitisations. Figure Technologies has issued asset-backed securities using its Provenance blockchain, with Intain customer WSFS acting as trustee. Last week, Redwood Trust’s CoreVest announced a $313 million loan securitization using Liquid Mortgage’s blockchain technology to track loan payments. And Symbiont has built an asset-backed securities platform built with Vanguard.


Leave a Comment

Your email address will not be published.