Digital securities company Akemona has become the first company to be regulated by the US Securities and Exchange Commission (SEC) for a smart contract-based funding portal built on blockchain technology.

Regulated under section 3(h) of the Securities Exchange Act, which handles what is known as regulation crowdfunding, Akemona has developed a platform that enables small businesses to borrow directly from investors through a bond, using a blockchain-based smart contract.

Founded in 2018 by a group of former Fortune 500 executives, the company has developed the platform to combat current inefficiencies in capital markets, particularly around the time it takes for traditional securities to go through post-trade processes. At present, this typically takes 2 days, but Akemona’s platform will enable the process to be completed immediately.

“Digital Securities can be traded 24×7 and are settled immediately, providing full transparency of trade and pricing,” said Akemona founding partner Ravi Srivastava.

Having received regulatory approval, Akemona will continue with its ongoing beta test phase, and will launch its platform by the end of 2020.

Akemona harnesses blockchain to bring smart contracts to digital securities

Underpinning Akemona’s system is a software token known as aPledge, which according to CTO Brady Matthrews, represents “investment commitments as well as digital securities”.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

“Underlying an aPledge is a smart contract, which is a self-executing software containing the terms of the agreement between buyer and seller,” he explained.

“This agreement is immutable and resides on a decentralised blockchain network. All transactions executed by the smart contract are visible on the blockchain, which allows full auditability of transactions by any third-party.”

This regulatory approval also represents a key step in the growing acceptance of blockchain technologies across the world of finance.

One considered an outsider technology, blockchain is increasingly being embraced by mainstream institutions within the financial world, with JP Morgan among those embracing the potential of the technology.

Read more: Bank of England pitched blockchain operating system for digital currencies – but will it use it?