The company simplifies asset securitisation and eliminates the numerous challenges it abounds by offering a blockchain-based platform that automates and streamlines the complete lifecycle of asset securitisation.
Founded by a team of industry veterans, Cadeia has crystallised its position in the global financial firmament by developing a platform that is not only blockchain-agnostic but offers multi-purpose functionalities, enabling seamless and collaborative structuring, servicing, and settlement of complex financial procedures. Over the past few years, Cadeia has served several industry giants and empowered them to securely execute and automate financial transactions, garnering a perennial prominence as a customer-centric brand. Part of that audience is Bank Frick, an entrepreneurial and innovative bank specialising in banking for intermediaries.
By utilising Cadeia’s Digital Service Platform (DSP), the two companies successfully executed the first-ever end-to-end loan securitisation, run entirely on blockchain. This collaboration was a trailblazing landmark in the history of asset securitisation, opening the door to innumerable potentially efficient and viable blockchain applications in asset securitisation.
The first-ever fully blockchain-based transaction — GreyPeak 2021-1—was processed through a series of automatically generated smart contracts on the Ethereum blockchain, including securities issuance, settlement, running covenant testing, and rule-based cash flows. In this transaction, unsecured corporate loans of Bank Frick were securitised, where Bank Frick was functioning as an originator and servicer. The transaction was structured in three tranches (senior, equity, and junior), which were securely placed in the form of digital securities—Asset- Backed Security Tokens (ABST). The tokens were identified by International Token Identification Numbers (ITINs), provided by the International Token Standardization Association (ITSA). The tokens were then viewed and analysed via these identification numbers.
Unlike previously executed blockchain-based securitisation transactions—where smart contracts are utilised solely to tokenise receivables—Cadeia revolutionised the game by using additional smart contracts to automate rule-based cash flows in accordance with covenants and associated cash flow waterfall structures.
The substantial automation capabilities of the DSP empowered Bank Frick to reduce expenditure, settlement time, and manual and error-prone workflows, providing a common database for all transactions. The platform also improved coordination and immediate monitoring of transactions by all participating parties, including rating agencies, auditors, and regulators. Security and transparency were achieved throughout the whole lifecycle of the transaction, creating a legitimate trail of documents that improved regulatory compliance. This collaboration is a stark representation of how efficiently Cadeia enables banks and financial intermediaries to execute securitisation transactions with smaller volumes, improving their ability to mitigate risks and manage liquidity.
Blockchain Founders Group is a company-builder and early-stage venture capital investor, whereas Blockrocket is an accelerator and early-stage investor in blockchain startups. The organisations observed the numerous manual and unsophisticated processes asset securitisation entailed and how efficiently Cadeia could automate and streamline such procedures. Cadeia’s vision of empowering financial institutions to leverage the novel distributed ledger technology profoundly resonated with the investors, who realised the potential of such technology in loan syndication and several other use cases within the financial sector. A facet of Cadeia that imbued the companies to invest in it was the longstanding experience and reputation its team has gained and developed over the past few decades.
Cadeia is led by Patrick Hartl, who has been engaged in the M&A and securitisation domain for a long time and has had first-hand experience in both front and back office. Supporting him in this journey of revolutionising asset securitisation is Rolf Steffens, a veteran international investment banker who has spent over three decades in structures finance in companies like Deutsche Bank, HSBC, and Merrill Lynch. Dr Marco Schmitz, former Lead of Blockchain Compliance at Bank Frick, bestows on Cadeia his technical expertise in computer science, functioning as a driving force of Cadeia’s technological advancements. Leonhard Fehr, who has worked for Unicredit/ HVB for three decades, recently came on board with Cadeia as the Global Head of Institutional Clients, overseeing the company’s relationships with clients across the globe. Constantin Ketz, Vice Chairman and co-Initiator of ITSA, is leading Cadeia’s business development team, whereas Ferdinand von Kirch, a veteran investment banker, oversees the company’s finance and legal. Unequivocally impressed by the team’s industry expertise and drive to make global capital market transactions and financial products more secure and efficient, Blockrocket and Blockchain Founders Group are keen to support Cadeia in its eventful journey to transforming the international financial services firmament.