JPMorgan Chase & Co, Goldman Sachs Group, and associates of other banks including inter-dealer broker ICAP‘s venture arm are deciding on an investment in blockchain startup Axoni. The Axoni deal serves as the newest Wall Street effort to achieve traction with blockchain, which first developed as the system underpinning crypto currency bitcoin. The technology generates a shared electronic ledger that allows all parties to track information through a secure network, with no need for a central authority proof. Wall Street is speculating blockchain and analogous means can be applied to help slash some of their transaction processing and back-office expenses.
New York-based technology company Axoni, helps banks and other institutions advanced blockchain software to operate capital market developments. Over the past six months, it has operated a number of high-profile experiments with some of the financial businesses enormous players, in areas such as post-trade processing of credit default swaps and foreign exchange. The Axoni investment comes a month after rival blockchain company R3 CEV decreased the amount target to raise in a new funding round to $150 million from $200 million. In February, Goldman Sachs and JPMorgan were among the investors in a $60 million funding round in Digital Asset Holdings, a New York-based blockchain startup run by former JPMorgan commodities chief Blythe Masters.
In October, Axoni released that nine companies including Barclays Plc, Credit Suisse Group AG and JPMorgan had administered a profitable test applying its blockchain-based software on post-trade processing of over-the-counter-swaps. The group also included Thomson Reuters Corp, the parent company of Reuters. Earlier in the year, Axoni worked with ICAP to test a blockchain service for foreign exchange and with another group of firms to run post-trade processing for credit default exchanges.