
At RIVA Markets we’ve built a full market infrastructure to structure, issue, manage and trade digital assets. This end-to-end infrastructure is built in modules that are integrated into each other and can be used as separate modules through our front-end, as-a-Service model or as API based systems.
This includes RIVA Prime as Loan Origination System (LOS) to record all the data of the asset, the borrower and involved parties, the financials, and the asset structuring like senior, mezzanine and junior tranches with its terms.
With our RIVA Capital module we bring funds natively on-chain through our on-chain fund model and our integrated service provider module to set-up fund structures or integrate existing ones.
Assets, such as loan tranches can be structured and issued as digital and tokenized securities and the fund shares tokenized through RIVA Securities. These tokenized assets can then be listed and traded on RIVA Markets or third-party marketplaces, bringing liquidity to traditionally illiquid markets.
A Hybrid Solution of Efficient Securitization and Tokenization
The RIVA Securities Module takes in a central role to securitize assets as digital on-chain securities and as tradeable tokens.
Although the market for tokenized assets is gaining increasing attention with a steady growing number of institutions and start-ups issuing such assets, several studies have shown that it will still take several years until the buy-side is fully ready to trade and manage tokenized assets and the full potential will unfold. This is especially true for small to medium size asset managers, which are often less innovation-driven.
With RIVA Securities we’re addressing this transition and developed a hybrid system to structure and issue different types of securities in a highly efficient way in different securitization forms and jurisdictions fully digital and on-chain. Structuring and issuing securitized and tokenized assets with RIVA Securities slashes up to 90% of the efforts and costs of traditional securization. This can be single assets like single loan tranches or bonds for one or multiple investors, or structured assets like ABS, MBS, CDO, Funds or REITs as cost-efficient Luxembourg SPV compartments or single SPVs, or fund structures. Those assets can then be traded and settled through its ISIN, CUSIP or other identifiers and traditional methods like depository accounts and issued and settled as tokens at any given time. This provides asset managers and investors a flexible and seamless way for digital asset management and a hybrid method for settlement and trading without friction.
Structuring and issuing securitized and tokenized assets with RIVA Securities slashes up to 90% of the efforts and costs of traditional securization.
Flexible Structuring and Issuance of Different Asset Types
Our innovative ATOM (Asset-Traceability-On-Chain-Model), introduced in our last article, is a set of smart contracts with a flexible data model for digital assets. ATOM has a basic, but already comprehensive data model for each asset type and tranches and can be easily extended on-demand with additional data fields, ensuring advanced flexibility for asset issuers.
RIVA Securities already include several asset types to be efficiently securitized and tokenized for assets originated through RIVA Prime, on-chain funds through our RIVA Capital module as well as for 3rd party issuers to bring their existing assets on-chain as digital securities and as tokenized securities. This can also be single assets like whole loans or bonds, structured loan tranches or loan pools, or full funds that add assets over time. The underlying assets of a fund can also be securitized and tokenized to trade on secondary markets like RIVA Markets or other 3rd party marketplaces for increased portfolio liquidity.
Full On-Chain Traceability
Through ATOM we’re not only recording all data on-chain, we also track the asset along its entire lifecycle with a real-time monitoring, balance and valuation. Each transaction, servicing and changes related to the asset can be tracked and records kept up to date in real-time through on-chain functions and OpenBanking API integration.
Through our API integration with Moody’s Analytics, this lifecycle data can always be traced to create a real-time advanced risk analytics and rating for the asset.
Tokenized funds track the underlying assets on-chain and consolidate the portfolio holdings on the fund level with full drill-down in the underlying assets.
A real-time asset transparency that does not exist for any asset currently on the market.
Interoperability for Seamless Trading Across Chains
With the awaited on-chain settlement roll-out by Swift and its blockchain interoperability through Chainlink’s CCIP (Cross-Chain-Interoperability Protocol) the settlement of digital assets will be institutionalized. As we built ATOM chain-agnostic, assets can be issued on one chain and transferred to another chain with its full data history. This is possible through our data-rich token concept of ATOM, which records that data continuously on the chain where it currently sits and transfers this traceability fully to another chain where the token be possibly transferred. By using the ERC-3643 standard, the tokens are compliant with financial regulations and through CCIP’s privacy protections, the privacy of the asset is always cryptographically secured, even on public permissionless chains.
The Way Ahead
As we’ve developed our full end-to-end infrastructure and on-chain ATOM data model with the first asset use cases, we’re starting to on-board our first clients to structure an on-chain fund vehicle and originate the underlying equity and debt assets for commercial real estate projects. In parallel we’re deploying data models for additional asset uses cases with focus on different private debt assets such as corporate loans and bonds and will actively work with our next clients in this space.