Blythe Masters’s Blockchain Firm Raises Money, Hires Executive

LAGOS (Capital Markets in Africa) – Blythe Masters’s blockchain software firm Digital Asset Holdings LLC raised another $40 million and hired a technology executive who previously worked for software giant Microsoft Corp. and quantitative hedge fund Two Sigma Investments.

The company, where former JPMorgan Chase & Co. banker Masters is chief executive officer, is one of several trying to reshape finance by leveraging the blockchain ledger technology that underpins bitcoin and other cryptocurrencies. DAH’s clients include the Australian Stock Exchange and Depository Trust & Clearing Corp., the back-office entity that clears and settles all U.S. stock and bond trades. Both are testing whether they can shift over to blockchain to cut settlement and payment times from days to minutes.

Blythe Masters

DAH has now hauled in more than $110 million of funding, according to a statement Monday.Prior investors include JPMorgan and CME Group Inc. This latest funding round was led by Jefferson River Capital. Other participants, which included old and new investors, weren’t identified by name.

Clyde Rodriguez, previously co-chief technology officer at Two Sigma who also worked at Microsoft, will be chief information officer and CTO of engineering for New York-based DAH.

Read more: Blythe Masters tells banks the blockchain will change everything

“We are in the early stages of an important technological transformation that requires strong engineering discipline to deliver credible and practical solutions,” Rodriguez said in the statement. “Distributed ledger technology has the potential to bring greater transparency, security and efficiency to financial services and beyond.”

Blockchain, also known as distributed-ledger technology, has captivated Wall Street executives because it could process virtually any kind of trade or money transfer in minutes. That would vastly reduce the capital that has to be set aside until transactions are settled. Industries such as healthcare, supply-chain management, pharmaceuticals, and mining are also experimenting with the software to improve efficiency or ensure the provenance of diamonds, for example.

ASX, the owner of the Australian Stock Exchange, has said it plans to make a decision by December on whether to use the system designed by DAH. “We are on track,” Masters said in a telephone interview. “That doesn’t mean ASX has made a decision but we’re optimistic.”

As for the hire of Rodriguez, Masters said all of his past experience is relevant. Two Sigma was important because “it exposed him to financial markets for the first time.” His work for Microsoft dealt with delivering enterprise software systems to global clients, she said.

“There’s a direct analogy there to the phase this company is now entering,” she said. “We’re no longer in the mode of imagining, we’re in the mode of executing.”

Source: Bloomberg Business News