Dinari, a supplier of Tokenized public effects based in the US, will launch his own blockchain and join the latest wave of companies to build their own infrastructure.
The chain, called the Dinari Financial Network, wants to serve as a coordination and settlement layer for the effects that have been issued on other networks such as arbitrum
“This will be the fundamental infrastructure for our settlement and opening system, which has so far been mainly outside the chain,” Gabe Otte, CEO and co-founder of Dinari told Coindesk in an interview.
The test network is currently live with plans for a public launch in the coming weeks, Otte added.
Dinari is one of the companies that lead the tokenization of shares, a red-hot trend to trade with shares available on blockchain rails. Proponents say that tokenization around trade, faster settlements could make possible and reduce costs.
Recently Digital Trading Platform Robinhood introduced share to stocks on Ethereum Layer-2 Arbitrum
For EU users with future plans to build his own chain, while crypto exchanges, including Kraken, also started offering tokens of US shares and ETFs.
In June, Dinari obtained a registration of broker dealer through Finra with approval to Tokenize National Market System (NMS), which offers a conforming solution to issue token version of American public shares. Gemini, the exchange founded by Cameron and Tyler Winklevoss, launched Stocktokens in the EU with Dinari who provided the tokenization infrastructure in the backend.
Why still an L1?
Dinari’s decision to build his own chain is a recent pattern that is seen in fintechs and crypto companies. USDC Stablecoin Emittent Circle and Payments Company Stripe revealed this week to pursue its own block chains. Rival tokenization companies such as ONDO Finance and Securitize (collaborated with Ethena) also work on their own networks.
With this approach they want to get more control over compliance with regulations, uptime and integration with traditional financing systems compared to the use of existing public block chains.
For Dinari, having their own chain was “out of necessity,” said Otte.
“Many of the public chains do not really allow the right level of compliance to be needed to deal with effects,” he explained. Another important reason was to facilitate and coordinate transactions of Dinari-spent tokens over several block chains without fragmenting.
“If you are part of [the stock tokens] Lives on Solana, part of Arbitrum, part on the basis, you take this $ 100 trillion market and fragment it, “he said.” How do you prevent that? With a specially built chain with which we can essentially draw liquidity over all these different chains. “
By uniting the settlement and liquidity, the company wants to bring constant, conforming trade of US shares to a global market by shooting a similar role such as the Depository Trust and Clearing Corporation (DTCC) for the stock market. DTCC is the world’s largest effects clearance and settlement system.
To choose Avalanche to build, Otte emphasized the need for flexibility and the possibility of arranging transaction costs (gas prices), which is difficult with Rollup and Layer-2 solutions. AVA Cloud’s Blockchain -Service of Avalanche lets companies run blockchains and adjusted for their own needs, said Morgan Krupetsky, VP of ecosystem growth at AVA Labs.
Neutral
Dinari wants to position the Dinari -Financial Network as a “neutral clearinghouse” for industry, Otte said.
In the beginning, governance comes from a consortium of institutions, including Gemini, Custodian Bitgo and asset manager Vaneck, who will serve as validators and also offers storage services.
The plan is to fully decentralize the chain in the future, Otte said. That may include launching the chain’s own board, he added.
Read more: Tokenized shares need an ADR structure to protect investors