Japan-based banking giant Nomura announced today that its digital asset subsidiary, Laser Digital, has made a strategic investment in Infinity, an Ethereum-based interest rate protocol without a custodian.
Infinity’s wholesale exchange, the first of several proposed infrastructures, will provide cross-exchange clearing, fixed and floating rate markets, and enterprise-level risk management using hybrid on-chain/off-chain infrastructures that offer transaction efficiency, security, and scalability.
Infinity is a pioneering interest rate protocol that forms the basis for benchmark interest rates, institutional lending, borrowing and risk management in DeFi. The money market exchange protocol was founded by Kevin Lepsoe, ex-Morgan Stanley Head of Structuring.
“Infinity is building critical infrastructure for DeFi, and its protocol, which enables price discovery and risk management within DeFi, is transformative for institutions. Infinity’s groundwork is paving the way for on-chain institutional flows, new rate levels and risk innovation, and we are keen to support their advances in hybrid finance.”
– Olivier Dang, Head of Ventures at Laser Digital
Recently introduced by Nomura to spearhead its digital assets ambitions, Laser Digital will be led by Steve Ashley, who previously led Nomura’s wholesale division, with Dr. Jez Mohideen as CEO. Headquartered in Switzerland, Laser Digital’s investments are focused on DeFi, Centralized Finance (CeFi), Web3 and Blockchain infrastructure.
The investment comes as the Bank for International Settlements (BIS) released guidelines for crypto exposures in December 2022, treating bank-mandated risk weights for tokenized assets 1:1 with their analogous counterparts. The guidelines for banks come into effect on January 1, 2025.
With $300 trillion in outstanding loan collateral and multiples of that in the credit, derivatives and equity markets, the new guidelines point to a major wave of tokenization of financial and real assets.
The Inifinity mainnet, which is currently in beta, is scheduled to launch by the end of Q2 2023.
