BlockInvest, a Crédit Agricole Italia-backed tokenization platform, is making significant strides in digitizing distressed credit markets, ushering in a new era of transparency and efficiency for financial assets. The initiative focuses on non-performing loans (NPEs) or distressed credits, addressing challenges such as information asymmetry, limited operators, liquidity issues, and the absence of a secondary market.
In 2023, the NPE market in Italy alone exceeds 300 billion, underscoring the urgent need for innovative solutions. European authorities, including the European Central Bank (ECB), actively advocate for strategies that increase transactions on the secondary market, emphasizing the crucial role of efficient risk management for financial institutions.
Blockchain and Tokenization for Market Transformation
The integration of blockchain and tokenization offers a transformative solution to the persistent challenges in the NPE market. This approach provides transparency, efficiency, and global accessibility. BlockInvest’s framework goes beyond facilitating fractional ownership and enhancing liquidity through tokenization; it supports clients in managing the entire lifecycle of distressed loans on-chain. This includes the credit recovery phase, investor communication and voting, and adherence to regulatory obligations.
Key Initiatives by BlockInvest
BlockInvest is spearheading two pivotal initiatives:
- Proof of Concept for On-Chain Digital Note Issuance:
- In collaboration with 130 Servicing, a leading Italian Master Servicer, BlockInvest is conducting a Proof-of-Concept project to issue native digital Asset-Backed Securities (ABS) notes directly on-chain.
- This initiative validates the efficiency of blockchain technology compared to the current state, laying the groundwork for offering tokenized services to both new and existing clients.
- Tokenization of Distressed Credits Secured by Real Estate Mortgages:
- BlockInvest is leading the tokenization of distressed credits secured by real estate mortgages acquired by Davis & Morgan S.p.a., an Italian regulated financial institution.
- The project involves fractionalizing the financing agreement and related instruments using BlockInvest’s advanced token model design.
Choosing Polygon for Innovation
BlockInvest has strategically chosen Polygon‘s cutting-edge technology to power its initiatives. Leveraging Polygon PoS (Proof of Stake), BlockInvest aims to capitalize on scalability, speed, EVM compatibility, and security for its projects. The collaboration with Polygon Labs is poised to set new benchmarks for security, speed, and accessibility in asset tokenization.
Lorenzo Rigatti, Founder and CEO of BlockInvest, expresses excitement about the collaboration, emphasizing the pivotal role of choosing the right protocol in dealing with regulated entities in complex processes.
Colin Butler, Polygon Labs’ Global Head of Institutional Capital, anticipates the transformative impact of broader adoption of tokenization technology, positioning BlockInvest at the forefront of this movement.
About BlockInvest
BlockInvest is a rapidly growing fintech startup based in Milan, Italy, providing plug-and-play and customized solutions for companies and financial institutions entering the blockchain space. The platform specializes in tokenizing various real-world assets, making them accessible on the blockchain.
About Polygon
Polygon Labs develops Ethereum scaling solutions for Polygon protocols, aiming to provide scalable, affordable, secure, and sustainable blockchain infrastructure for Web3. Polygon Labs has developed a suite of protocols for easy access to major scaling solutions, with widespread adoption in the Web3 space.
Image by Luca Bravo from Unsplash
Read other stories: Obligate Joins Tokenized Asset Coalition to Advance Institutional Adoption of Tokenized Assets
World’s first AI-powered GPT to focus on regulation in tokenization and digital assets