Vig insists that Abacus doesn’t need an army of engineers, though. The two have just two other employees as of this writing. After they headed off to different colleges - they graduated from Purdue and the University of Texas, respectively - they came together to form an analytics platform, and, more recently, to create Abacus. The young software engineers originally met in 2012 through the Texas Academy of Mathematics, a college entrance residential program for gifted high school students. Presumably, the technology that Abacus is developing is of burgeoning interest to all of these parties, but one assumes that investors are also putting stock - no pun intended - in Vig and his co-founder, Ian Macalinao. And Abacus has partnered with AirSwap, a New York-based peer-to-peer trading platform. Vig says that Abacus also is working with a Chicago-based exchange called OpenFinance, which is about to begin trading its first security token. that allows them to trade hundreds of tokens directly from their wallets. Other investors in the round include YC and Coinbase, which has been plain about its ambitions to some day offer crypto securities trading, and that last month took another step toward that end when it launched over-the-counter trading for institutional customers that allows them to direct trades between each other.Ĭoinbase, perhaps unsurprisingly, is also among Abacus’s first “exchange” partners, or it will be, once it goes live with a new offering that will first be made to customers outside the U.S. In fact, the company just closed on $2 million in funding, including $1 million from serial entrepreneur and investor Justin Kan. It could be a painfully long period before that changes, but true believers in digital assets are covering their bases in the meantime, and betting on Abacus is seemingly one way to do that. What’s left of the crypto space right now, writes Evans, is a “ giant casino of penny stocks, with little to no utility outside of financial speculation.” As TC columnist Jon Evans noted over the weekend, Bitcoin - priced at $19,000 apiece at this time last year - is now trading at $3,500, and other cryptocurrencies have cratered even more dramatically. Right now, of course, the mere idea of a secondary market for tokenized securities feels like a very distant possibility. That shift has given rise to secondary sales as we know them today, but Abacus thinks it can help usher in yet another way for startups and funds to exit their holdings: through secondary markets for tokenized securities. Meanwhile, because so much money has poured into the private market over the last decade, companies have pushed off all of these types of events for longer periods of time. If it works, it could be a big deal, too. Consider that traditionally, funds and companies have experienced liquidity events either when they get acquired or sold or go public (or get liquidated). The company’s goal, ultimately, is to make it easier to buy and sell private securities, as well as to make the process far more transparent. Indeed, using the blockchain and its proprietary software, Vig says that Abacus can facilitate the issuance, administration and settlement of tokenized financial instruments on the blockchain through smart contracts that it keeps track of via an on-chain storage layer. For the crypto market to become attractive to institutional investors, companies and their investors need to ensure that tokenized securities - digital assets subject to federal security regulations - can be as easily tracked and traded and exchanged as traditional stock shares.Ībacus, a young company that passed through Y Combinator this past summer, thinks its technology can make it so.Īccording to the picture painted by Abacus founder and CEO Pradyuman Vig, Abacus can both automate compliance for tokenized security transactions and keep track of the chain of custody of private securities, making it simple for the SEC, among other parties, to audit the entire history of these securities transactions.
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