ProvLabs, a blockchain infrastructure provider, has completed a seed funding round in late 2024 and aims to double the amount of assets tokenized on the Provenance blockchain this year to over $25 billion.
In December 2024, ProvLabs announced that it had completed its seed fundraising, as well as its separation from the Provenance Blockchain Foundation. The initial funding round was led by Morgan Creek Digital and GateCap Ventures.
Sachin Jaitly, Morgan Creek Digital
Dr. Sachin Jaitly, General Partner of Morgan Creek Digital and Board Member of ProvLabs, said in a statement: “Blockchain technology is driving the next generation of financial innovation. We are at the start of a seismic shift in financial markets as real-world assets make their way on-chain.
Anthony Moro, chief executive of ProvLabs, told Markets Media that since trading began under the button tree in front of the New York Stock Exchange with physical certificates, each iteration in the financial space has added more functions. He said: “This latest iteration adds a revolutionary amount of features. »
Moro argued that ProvLabs has an advantage in that the Provenance blockchain was designed specifically for financial services. In contrast, the most popular blockchains are generic and require building a stack of smart contracts on top of them to make them productive.
“In regulated financial services, this stack of smart contracts turns into what I call a Jenga risk tower,” Moro added. “In five years, will these smart contracts still be interoperable, will the code be cracked, who owns the code?
Smart contract functions are integrated into Provenance’s core blockchain protocol, making it an operating system for global financial services according to Moro. ProvLabs sees an opportunity to tokenize several billion dollars of real assets over the next decade and help financial institutions integrate blockchain technology into their operations.
“We will have a fairer, cheaper, faster and safer financial system,” Moro added. “We are going to place $1 trillion in real assets on Provenance over the next 10 years. »
Tokenization
Institutional Coinbase Crypto Outlook 2025 said real-world tokenized assets grew by more than 60%, from $8.4 billion at the end of 2023 to $13.5 billion as of December 1, 2024, excluding stablecoins. In particular, on-chain U.S. Treasuries more than tripled from $760 million to $2.6 billion as of December 1, 2024, primarily driven by three new tokenized treasury funds, including BlackRock’s fund, BUIDL .
Source: Institutional Coinbase
However, Moro argued that token funds are “interesting, but not revolutionary.” In contrast, breakthrough products take illiquid asset classes that work with many intermediaries and make them more accessible through a decentralized ledger.
Moro gave the example of Figure Technologies digitizing home equity line of credit (HELOC) loans on the Provenance blockchain and saving approximately 0.125 basis points on each HELOC loan.
“Having access to another tokenized Treasury fund is not a big one deal,” Moro said. “Blockchain technology saves money on a mortgage, it’s a big deal.”
For example, a traditional mortgage requires documentation, including a wet ink signature in front of a notary, which must be video recorded. Moro explained that all off-chain data points, including the video notary session, can be included in ProvLabs’ Block Vault product which integrates on-chain and off-chain protected data rooms for sensitive information. All data is then linked to the non-fungible token (NFT) that creates the loan so anyone who purchases a mortgage over the years can access the NFT to view the video and easily access all the information in one place.
Anthony Moro, ProvLabs
“About 20% of HELOC issuers use the Provenance chain, so I think that’s the only asset class that has been disrupted by blockchain,” Moro added.
According to Moro, Figure Technologies issues approximately $650 million in tokenized real estate loans each month, which he says is more than the rest of the tokenized world combined.
“The Provenance Chain has a three to five year head start because it is the only institutional grade company that has been built and distributed on the blockchain,” Moro said. “It can be used for complex assets where you need to think about the perfection of asset ownership. »
The funding round will be used to develop BlockVault as well as ProvConnect which connects businesses, fintechs and individuals to the Provenance blockchain; Asset Manager which symbolizes and manages the life cycle of any digital asset; and Trade and Transfer which enables settlement, warranty and exchange.
Moro added that he is also “incredibly excited” about Figure filing a registration statement with the U.S. Securities and Exchange Commission for the first SEC-approved stablecoin that earns a yield.
In digital finance, stablecoins have been used to transfer value and liquidity seamlessly 24/7/365 around the world, unlike a fiat currency such as the dollar American which is used in the traditional banking sector. Stablecoins are a type of cryptocurrency designed to maintain a stable price over time by pegging its value to a reference asset such as a fiat currency or commodity. They are backed by guarantees but have not provided returns to investors.
“Instead of an unsecured loan to a private company, investors can now purchase an SEC-backed yield stablecoin,” Moro said. “I think it’s quite revolutionary and will change the market in 2025 by opening up a multitude of financial services applications.”
Fidelity Digital Assets said in its 2025, looking to the future that stablecoins could potentially continuing to evolve as a major use case complementing other potential applications such as tokenization of real-world assets.
“However, while progress has been made, stablecoins are not yet a fully-suited product,” Fidelity added. “We anticipate additional measures will be implemented to manage counterparty and compliance risks, facilitate integration with traditional payment and lending rails, improve cross-chain interoperability, and meet asset demand generators of yield.”
Growth
Moro described that the ultimate goal of the on-chain finance movement is to allow qualified investors to exchange assets, such as public stocks, for Bitcoin, ether or in a BlackRock fund, and to securely cross-reference all their assets into a secure wallet that they own and control. .
“By the end of 2025, the TVL of the Provenance channel will be well above $25 billion in real assets, which will be more than double the current value,” Moro said.
TVL, or total value locked, is used in cryptography to measure the total US dollar value of digital assets locked or staked on a particular blockchain network. Moro expects that by the end of 2025, assets, including all types of insurance, will be on-chain, just like home equity investments.
It also expects Provenance and HASH, the native token of the Provenance blockchain, to be listed on centralized exchanges for the first time in 2025.
Fidelity Digital Assets saidit total the nominal amount of real-world on-chain assets stands at $14 billion, up from $8 billion in 2023. In financial services, Fidelity Digital Assets expects large banks and asset managers must continue to on-chain traditional assets such as bonds, credit and funds, with booming apps are also hitting the market.
“If $14 billion in real-world assets are on-chain, right? now, and if demand for this niche use of blockchain technology continues to grow throughout 2025, this will not be possible.It would not be surprising to see this value approach $30 billion by the end of 2025,” Fidelity added.
SUBSCRIBE TO THE NEWSLETTER
And receive exclusive articles on the stock markets
