00:00So $110 million for this fundraising, are you just going to be scaling what you're already doing?
00:05Are you building something new that the tokenization service has not fully built out just yet?
00:09A bit of both. So Kaiko originally is a data analytics and indices company,
00:14and so we're going to keep scaling that part of the business while heavily investing in our data infrastructure business.
00:20The data infrastructure business is finally reaching a point where it becomes critical.
00:26We're in a moment where tokenization is a reality.
00:30The question is, what do you do with tokenized assets?
00:33How do we embed them into financial workflows?
00:35And that's really the right timing to heavily invest into our data and for our business.
00:40So everyone like you says tokenization is inevitable, but adoption has been slow.
00:44What has been the blocker? Is it regulation or is it the companies?
00:48Because when you look at all the news, the big companies are in it.
00:52So sometimes I don't understand what's taking a while.
00:55I think it's a question of, you know, first we had to have the assets available.
01:00The technology is not the issue anymore, and it hasn't been for a long time.
01:03Now the assets are being tokenized.
01:05The DTCC is going in production in October.
01:08A lot of things are happening on the issuance side.
01:11Now the question is, we have the technology, we have the assets, we need usage, right?
01:16And in order to enable secondary lifecycle activities, in order to enable collateral mobility,
01:21you need to bring on the kind of data standards and data infrastructure that are critical in the traditional financial
01:29industry into the blockchain world.
01:32Data infrastructure for me is a key component of that, and that will trigger adoption.
01:37It's essentially proving that the fact that moving a capital markets workflow onto blockchain rail is more efficient and frees
01:46up capital and allows instant settlement, 24-7 trading.
01:50All of these great unlocks are brought by blockchain and tokenization, but still requires a lot of careful handling of
01:59all of the standards and the rigor that we currently have in TradFi that needs to be brought on chain.
02:04And I feel we're in that phase now.
02:06There are a lot of exchanges that are pushing towards that reality of 24-7 trading.
02:11I think there's a lot of interest in that.
02:12What does risk management look like when you are trading after the traditional 4 p.m. close?
02:17There's more volatility, less liquidity.
02:21How does that conversation change, and how has that been evolving?
02:24Absolutely, you're correct.
02:26Crypto is 24-7.
02:27It is now starting to enable the 24-7 trading of traditional assets, yet not fully available on traditional venues.
02:35So we have markets such as perpetual swaps.
02:38Even prediction markets are some kind of a proxy of getting synthetic exposure to traditional assets 24-7.
02:44It does pose the question of liquidity.
02:46Obviously, lower liquidity equals higher volatility and more risk.
02:50And so all of these initiatives are finally merging into speeding up the adoption by traditional financial institutions and exchanges
03:01of blockchain technology.
03:02NASDAQ is an incredible example of that, right?
03:05Working and pushing really hard on tokenization standards.
03:08To Dani's point, sometimes, I mean, you have all of these supporters of tokenization, but you also have critics.
03:13And to them, the 24-7 is not actually attractive because they do want some guardrails in place, some breaks,
03:20you know, for things to settle.
03:21I mean, if it's 24-7, just like the crypto market, especially on the weekends and overnight, liquidity is thin,
03:27and that's when it gets really volatile.
03:29I think there will be a bit of a middle ground.
03:31The technology enables 24-7.
03:33It doesn't have to be 24-7.
03:35So you can start moving into the technology on different rails and not necessarily change everything to instant settlement 24
03:42-7.
03:43In all cases, a lot of thought needs to be brought into all of the kind of market infrastructure pillars
03:51that needs to be built on chain.
03:53We can't just take DeFi and throwing traditional assets.
03:56Going back to the data angle, I mean, traditional finance uses trusted authoritative data in order to process financial transactions.
04:05This needs to be brought on chain.
04:07This is really what data infrastructure is about.
04:09We will still need, in an on-chain world, to have circuit breakers, to have dispute resolution mechanisms, to have
04:15some form of failover in security.
04:18And if I take the scope of data, our approach is that data needs to be signed and authenticated by
04:23the data owner, whether it's the exchange or the IP owner of the data, specifically for the purpose you just
04:29mentioned, right?
04:30We need to know what is a dispute resolution mechanism after a contract settles.
04:36If there is any dispute, you need to know what went wrong, kind of.
04:39So all of that migration of capital markets onto blockchain infrastructure requires a lot of thought.
04:45And I think that's what's happening right now and explains a bit why it's taking some time.
04:49I don't want to jump the gun because I know you've just announced this fundraising round.
04:52But a lot of these traditional financial firms love having tech in-house.
04:57Would you ever look at merging into a bigger player, into an S&P, into a NASDAQ?
05:02Would that ever be on the cards for you?
05:04It's a tricky question.
05:06No, I guess, yes.
05:07For now, we're really focused on bringing that kind of technology, data and technology company for the integration of the
05:16current capital markets industry onto blockchain rails,
05:19partnering with companies like Bloomberg, with whom we've been working for the past nine years now on crypto assets.
05:24And now this tokenization move is expanding the scope of our partnership.
05:28S&P is another example of that.
05:30We started by doing crypto data-related things, and then we've announced this major co-branded partnership on digital asset
05:38indices.
05:39We've been working on the tokenization of their actual indices to provide data that becomes programmable instruments natively on chain.
05:47There's a lot of things that are moving, and for now, we are building a data technology company that can
05:54serve as a distribution technology for IP owners into the blockchain to service their clients into the blockchain.
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