Exclusive: Discussions underway on multi-coin, state-backed crypto exchange and custody
Could a Middle Eastern government be about to regulate and underwrite its own decentralised exchange and custody system?
Over the last week, Global Blockchain Technologies – a publicly-listed, Canadian crypto-mining operation and blockchain project incubator – has been courting investment interest in its Laser Network proposal.
Calling itself the ‘SWIFT of the Blockchain system’, Laser is a ‘Service Layer’ facility built upon Ethereum, that will – it’s creators claim – allow inter-blockchain transactions, provide anonymity, and increase speed. Announced in April, along with a whitepaper, it has apparently attracted the attention of several large-scale institutional investors in since the sale began on September 3rd, and Global Blockchain will begin contacting others who have registered interest as of today.
At the spearhead of the technical development of Laser is Global Blockchain Technologies’ CEO, Shidan Gouran. We spoke with Shidan at last week’s World Blockchain Forum in London, and he had plenty to say about the Laser network, and projects that would be arising from it.
Most interesting of all is the prospect of a cross-chain Decentralised Exchange (DEX) that Global Blockchain is planning to build using Laser Network technology and token economy.
“We’re building a decentralised exchange on top of it [Laser]. I haven’t named it yet… but, here’s the thing that’s great about it: we’re not just developing a product we’re developing a business.”
What Shidan is specifically talking about is offering a vertical for users of the exchange whereby cryptocurrencies from various blockchains can be traded across the DEX using Laser technology, and then stored – and, equally importantly, insured – under the auspices of a state-backed, regulated custodial option.
“We’ve been in talks with a major financial player in the world,” he told CNR, “a country actually.”
“The regulators, in the Middle East – who we believe are at the forefront of these technologies and understanding where they can go – might be working with us to offer insurance on custodianship. That would be a World’s first.”
“No country has, to date, insured a cryptocurrency exchange like they would a bank,” he continued, “and this country is seriously considering that. In partnership with us. We’re going to be deploying this exchange, if this deal goes through, as the exchange for this country.”
Such a state-backed custodial option would, Gouran asserts, be “way, way more important than an ETF.”
“It’s immensely more important,” he says, “because it’s a real application that will bring liquidity to the market to a level that just doesn’t exist today.”
Custody has been one of the big issues surrounding cryptocurrency of late, it has come up consistently in the US Securities Exchange Commission’s thinking on the space, was a major part of the recent Bakkt announcement, is the current focus for Goldman Sachs’ work in the crypto market, and has been consistently pointed to as one of the hurdles to mass adoption of cryptocurrency by larger financial institutions looking to create consumer-facing products.
Last week we reported on HyperVault’s plans to offer insured custody to institutional-size investors, a market where it is eyeing multi-hundred million dollar contracts, but what Global Blockchain appear to be proposing is a scale even beyond that. Indeed, according to Gouran it is working on a deal with a Middle Eastern government to provide backing to their custodial service.
As Shidan said, the deal is far from done as yet. However, were it to come to fruition it would be a major development in an area that has increasingly come into the spotlight as the blockchain industry looks to court large-scale investment from mainstream financial players.
You can see more about Laser here.
Our full interview with Shidan Gouran will be available soon.
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