Tokenovate Targets $1.2 Quadrillion Derivatives Market With Its Trailblazing Blockchain Products

With an enterprise blockchain network like BSV that scales unbounded, anything and everything can be brought on-chain, including the massive derivatives market.

Cambridge, U.K.-based Tokenovate provides distributed financial market infrastructure, enabling programmatic lifecycle event management of the trading workflow in the derivatives sector. Its products include smart contracts and tokenization.

At the London Blockchain Conference, Tokenovate’s chief product officer John Anderson told CoinGeek Backstage that the company had just launched a minimum viable product for its derivatives market solution.

“What we’ve been implementing over the past year has been the creation of a lifecycle trading engine which is underpinned by the blockchain itself. We’re using smart contracts to manage the lifecycle of derivative trades, and we’re incorporating domain models within that. We’re validating from [trading] venues, OTCs, etc,” he told CoinGeek Backstage reporter Claire Celdran.

While Tokenovate has focused mainly on derivatives trading, Anderson revealed that it has been exploring the tokenization and lifecycle management of carbon credits. In 2023, the company launched the world’s first smart legal contract for voluntary carbon credit derivatives trades.

The voluntary carbon credits market allows corporations to pay to offset carbon dioxide and other greenhouse emissions. This sector is valued at $1 billion today, and is expected to reach $50 billion by 2030, according to McKinsey.

Since this market is still relatively new, Tokenovate is looking to become one of the pioneers with its unique blockchain products. It recently signed an agreement to work with a peatland restoration development partner in Scotland for carbon credit purposes. Tokenovate created tokens and derivatives for the company, which it then sold to its clients; the entire lifecycle is managed on Tokenovate’s platform.

“We’re enriching the tokens essentially with location and LEI (legal entity identifier) data, which increases the value and integrity of the carbon credit itself, and, in the long term, increases the value for the entire market,” said Anderson.

Tokenovate’s platform is asset class-agnostic, which allows the company to pivot into any viable asset class. Anderson revealed that the company is already exploring several other asset classes.

“We’re targeting the financial sector for capital markets and creating a platform that can be shared as a multi-tenant SaaS platform based in the cloud. It can be shared amongst a number of ecosystem partners where you could trade through venues, provide custody for digital assets, and bring counterparties to that platform.”