R3 acquires stablecoin tech firm Ivno

The enterprise blockchain provider R3 has acquired Ivno, a London-based digital currency technology firm that will bolster R3's ability to support stablecoin development.

Ivno specializes in financial asset tokenization, or the process of issuing tokens on a blockchain that can represent digital currencies, shares in a company or other assets.

The combination of R3 and Ivno will "accelerate" R3's ability to offer enterprise-grade and regulatory-friendly stablecoin issuance to its customers, R3 says. "The underlying technology provides an opportunity to significantly optimize the cost and speed of financial transactions," Todd McDonald, chief product officer of R3, said in a news release. Financial terms of the deal were not disclosed.

R3, a consortium with more than 300 members including banks, government agencies and financial technology firms, will integrate Ivno with R3's digital currency sandbox, which is used to test new currency concepts.

Stablecoins pin their values to traditional currency, and are designed to hedge against the valuation shifts in cryptocurrencies such as Bitcoin and ether. Stablecoins are expanding, with the cryptocurrency firm Circle, which issues the USDC stablecoin, signaling it intends to apply for a bank license. Diem, the Facebook-affiliated stablecoin, is expected to launch soon, creating competition for banks to support stablecoins. Visa and Mastercard have signaled they will support stablecoin transactions, placing card issuers in the position of potentially processing stablecoin payments.

Federal Reserve Chairman Jerome Powell has expressed an interest in regulating stablecoins, creating a need for banks and payment processors to manage compliance.