Paul Fan and Tim Hsu have created a unique solution for asset managers and institutional investors. A solution provided by Munich Reinsurance Company. (Photo: Cybavo)

Paul Fan and Tim Hsu have created a unique solution for asset managers and institutional investors. A solution provided by Munich Reinsurance Company. (Photo: Cybavo)

First prize winner of a US Department of Commerce competition and finalists at the Tokyo Financial Awards, Singapore fintech Cybavo wants to take on the European market from Luxembourg, where it has been based at  Lhoft since 2021.

It is testament to Luxembourg’s agility when it comes to bringing a company to the grand duchy, that the Luxembourg Trade & Investment Office in Taipei managed to convince Cybavo to make the move from Singapore, where it launched in 2018 at a time when there were huge upcoming needs in digital asset custody for the $20 billion market.

"As a leading financial hub in Europe, Luxembourg offers fertile ground for start-ups to test their solutions in a well-established financial sector," comments Sophie Liao, senior trade advisor at the LTIO in Taipei. A visit to Luxembourg was organised to allow Cybavo to meet representatives from Lhoft, the ministry of economy, Luxinnovation and to discover the start-up ecosystem.

"What impressed us very positively was how accessible all these institutions were," says the fintech's general manager EMEA Roberto Machado. "The ministry representatives were very open and transparent, and the financial regulator, the CSSF, interacted very easily. Being compliant with regulations is essential for our industry, so having access to the regulator and receiving clear information is crucial."

The LTIO advised Cybavo to enter the Fit 4 Start competition, and it was selected for the spring 2021 cohort. The team is expected to grow from two to five people in the coming months and double again by the end of the year.

Security and compliance, the two levers of Cybavo

The Luxembourg subsidiary has already seen its parent company increase its capital by €200,000 at the beginning of January. On 23 August it  announced a first pre-series A fundraising round of $4m, led by 500 start-ups.

"The company intends to use the latest funding to fuel its expansion into the East Asian, European and North American markets," said CEO Paul Fan. "The funds will also be used to further invest in research and development of cybersecurity and blockchain technology, and further increase customer and product satisfaction."

Its unique encrypted key system allows it to provide a solution that is both secure and compliant with regulatory requirements for those holding digital assets. Vault even bluffed the engineers Munich Reinsurance had recruited specifically to look for loopholes before the reinsurer signed up to the fintech. Since then, it has also launched a specific solution for exchanges and an application based on its encryption technology.

Last June, in the presence of US treasury secretary Janet Yellen, energy secretary Jennifer Granholm and Microsoft CEO Satya Nadella, the fintech made a name for itself , beating Israeli companies, which are generally considered to be untouchable when it comes to cybersecurity issues.

This story was first published in French on . It has been translated and edited for Delano.