Blockchain-Inspired Bank Payments Company Baton Systems Raises $12 Million

By Dan Anderson ● September 3, 2019
  • Bank-to-bank payments infrastructure company Baton Systems announced it raised $12 million to increase processing times within the payments market

Baton Systems — a provider of high-speed and blockchain-inspired bank-to-bank payments infrastructure — announced it raised more than $12 million to dramatically increase processing times and efficiencies within the $2 trillion global payments market. This round of funding was led by Trinity Ventures with participation from Alsop Louie and Commerce Ventures.

“This investment provides us with the strategic support and firepower to scale our bank-to-bank payment solution for the world’s leading financial institutions even faster and more effectively,” said Baton Systems CEO Arjun Jayaram. “Speed to market is critical in an industry that is crying out for modernization while at the same time facing a daunting global regulatory environment.”

This round of funding will be used to fund the continued rapid global deployment of Baton’s distributed ledger-based technology — which has already been deployed at three of the world’s top ten global banks as well as multiple exchanges and clearinghouses. And it was also used in a successful pilot with the Bank of England.

“Bank-to-bank settlement today is slow and manual, trapping billions of dollars that could instead be used to grow businesses. Baton is completely transforming the global bank payments infrastructure, leveraging the best of blockchain’s potential while mitigating its key concerns,” added Trinity Ventures general partner Schwark Satyavolu — who is a member of Baton’s board of directors. “Arjun and his team are the ideal visionaries and practitioners capable of turning this tremendous need into reality — and are already doing so for their many top-tier banking clients.”

Baton is already processing over $12 billion every business day in payments between market participants and clearinghouse counterparties thus enabling more efficient management of the foreign exchange settlements and margining process. And this increases transparency and reduces processing times from days to minutes, freeing up billions of dollars in tied-up capital.

The Baton platform integrates with financial institutions’ current collateral and cash systems leaving their existing business processes, systems, and ledgers in place. And Baton then provides a customizable software workflow engine to coordinate among multiple systems and institutions — achieving record-fast, transparent, and efficient settlement by moving real assets in real accounts, along with instant reconciliation and reporting for all parties.

Unlike blockchain solutions, Baton’s technology enables clients to move real assets sitting in real bank accounts securely and nearly instantaneously without the need for digital conversion. And this reduces risks and increases transparency and security making Baton much easier than blockchain solutions for customers to adopt.

“We’ve been a firm believer in the potential of what Baton is doing for the payments industry since day one,” explained Alsop Louie partner Gilman Louie. “Since those first conversations, Arjun and his team have rapidly moved from concept to reality with a top-tier set of initial clients, and advanced discussions taking place with the A-list of central banks and global financial institutions.”