IOTA Foundation's $10 Million Investment Drive: Fueling Digital Trade and Tokenization

By Quincy Cahilig

Feb 29, 2024 03:28 PM EST

The recently launched IOTA Ecosystem Foundation has announced its entry into the investment arena, allocating a substantial $10 million for early-stage startups primarily focused on digital trade and the tokenization of real-world assets (RWAs).

This strategic initiative aims to propel innovation within the IOTA ecosystem, per CoinDesk. The specifics of these significant investments are expected to be unveiled in the coming weeks, shedding light on the newly formed trade tech ventures that will benefit from the Foundation's financial backing. Additionally, the Foundation plans to bolster startups building on the IOTA network through an accelerator program, further nurturing the growth of these ventures.

Sustaining Momentum

Established as a regulated entity in the United Arab Emirates (UAE) back in November, the Foundation's formal registration triggered a remarkable 43% surge in the value of IOTA's native token. Subsequently, IOTA has sustained a notable 20% increase, maintaining a steady position around the 30-cent mark. This positive momentum aligns with a broader bullish sentiment in the market, with the CoinDesk (CD20) index experiencing a substantial 66% upswing during the same period.

The initial wave of investments is strategically directed towards trade technology startups headquartered in the UAE and Africa, underscoring IOTA's dedication to fostering innovation and development in the digital trade and asset tokenization sectors within these regions.

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What Are The Benefits of Digitizing Trade?

In a blog post, Dominik Schiener, Co-Founder of IOTA and Chairman of the IOTA Foundation, highlighted the strategic significance of this venture, emphasizing, "By investing in the future of TradeTech, we are not just facilitating smoother trade transactions; we are laying the groundwork for a more interconnected and efficient global trade ecosystem. Our collaboration with leading organizations through the TLIP is a testament to our commitment to innovation and excellence in this field."

(Photo : Photo illustration by Dan Kitwood/Getty Image) In this photo illustration Dollar and Euro notes are displayed, on November 26, 2010 in London, England.

The initiative will begin with the launch of a public grants program in the upcoming weeks, followed by an accelerator program for startups in the UAE before summer and in Africa before the end of the year. These programs are designed to empower entrepreneurs and innovators to develop new trade solutions on the IOTA and TLIP infrastructure, providing them with the necessary resources and support to bring their visions to life.

The economic and operational benefits of trade digitization are substantial, according to studies conducted by ICC UK. Digitizing trade transactions could potentially reduce costs by 80%, halve the trade finance gap, decrease cross-border processing times from 25 days to one day, and enhance SME efficiency by 35%. These improvements are poised to significantly boost global trade efficiency and create new opportunities for businesses on a worldwide scale.

The IOTA Ecosystem DLT Foundation's investment marks a pivotal step in reshaping the landscape of digital trade and finance. Participants in this ambitious endeavor toward a future where digital trade infrastructure empowers enterprises and improves global commerce are welcome, according to the foundation's website.

Moreover, recognizing the substantial resources required to foster, propel, and sustain a robust ecosystem, the IOTA Foundation acknowledges the potential constraints faced by community members in terms of time and resources. In collaboration with the community, the foundation aims to support initiatives of various scales, propelling the IOTA ecosystem as an enduring and potent hub centered around the core IOTA technology.

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