SETL, a London-based blockchain infrastructure company, filed for insolvency with UK authorities today, March 7. However, SETL has also published a statement clarifying that the company is looking for a buyer to take over its central securities depository and "provide the capital required to support the growth trajectory."
The insolvency filing comes as a bit of a surprise seeing that, as mentioned in SETL's statement, the company was given full approval under central securities depositories regulation in October 2018 to launch its own central securities depository (CSD).
SETL's blockchain-powered OpenCSD was first announced in June 2016 as SETL's first commercial offering. The platform was designed to enable "any market participant to commission and run a permissioned registry service for payments, settlement and clearing of cash and other financial instruments." At the time, SETL's then-CEO, Peter Randall, touted OpenCSD as a platform that would revolutionize the organization of securities depositories and payments systems.
SETL is by no means daunted about the trailblazing potential of the technology but recognizes that the company is no longer in a financial position to contribute the necessary capital. Sir David Walker, SETL's chairman, spoke to the complexities of balancing development of the platform with the financial components of the company:
"Separating the software development business from the investments portfolio is a highly complex process, requiring expert, experienced and neutral management of the interests of all the creditors and stakeholders."
To address the need for neutral management, the board of SETL has appointed an independent administrator, Quantuma LLP. As a neutral third party, Quantuma will represent the interests of current stakeholders and creditors, enabling SETL to "balance its strategic infrastructure holdings and continue its software development activities on a business as usual basis."
A representative from Quantuma, Andrew Andronikou, agreed that this transition will enable SETL to focus on technological growth while Quantuma deals with investors:
"This marks a significant moment for SETL and we are honoured to have been entrusted to work on behalf of the business and its investors. We are highly experienced in navigating these milestones to ensure that businesses are fit for the future and look forward to helping SETL in its quest for growth."
SETL says the plan will position it for a "strong financial future." Let's hope SETL can find a buyer; it looks like the company knows exactly where it wants to go.
Nicholas Ruggieri contributed reporting for this article.