UBS trials tokenized money market fund on Ethereum

The tokenized fund pilot is part of Project Guardian, an industry initiative led by Singapore’s central bank to bring real-world assets onto blockchains

article-image

nitpicker/Shutterstock modified by Blockworks

share

The asset management arm of Swiss banking giant UBS has launched a tokenized investment fund on Ethereum.

The tokenized Variable Capital Company (VCC) fund was launched as part of Singapore’s Project Guardian pilot, an initiative by the Monetary Authority of Singapore announced in May last year. UBS said it aims to carry out more pilot programs under Project Guardian.

The fund is structured as a smart contract on Ethereum and was launched using the bank’s proprietary tokenization service, UBS Tokenized, according to an announcement on Monday.

It allows UBS Asset Management to perform various functions, such as processing fund subscriptions and redemptions.

“This is a key milestone in understanding the tokenization of funds, building on UBS’s expertise in tokenizing bonds and structured products,” said Thomas Kaegi, Singapore and Southeast Asia head at UBS asset management. 

“Through this exploratory initiative, we will work with traditional financial institutions and fintech providers to help understand how to improve market liquidity and market access for clients,” he added.

According to a recent report by the Bank of International Settlements, tokenization has the potential to significantly enhance efficiency and transparency in financial markets.

Research by Bank of America suggests that the total value of tokenized assets could represent as much as 10% of global GDP, amounting to $16.1 trillion, by the year 2030.

Companies such as Goldman Sachs, JPMorgan, Hamilton Lane and Siemens have previously announced their involvement in asset tokenization projects.

UBS first ventured into the blockchain realm in November last year, issuing a $370 million bond on SIX Digital Exchange’s private blockchain platform.

That bond was designed for regulated tokenized offerings and was also made available on the Six Swiss exchange. 


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

MON - WED, MARCH 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience:  Attend expert-led panel discussions and fireside chats  Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts   Grow your network […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Frax report cover.jpg

Research

Frax saw continued development in its frxETH liquid staking derivative and Fraxlend money market throughout 2023. Frax V3 introduces an RWA strategy to drive utility to the protocol's cornerstone product, the FRAX stablecoin.

article-image

On-chain debt capital markets platform deploys on Coinbase-incubated layer-2 after structured investment products push

article-image

Past performance is not indicative of future results, sure, but no need to rain on the bitcoin price parade just yet

article-image

Circle’s letter follows one from the Campaign for Accountability alleging ties to Justin Sun and TRON

article-image

Ark could look to sell its $130 million position in GBTC to inject capital into its proposed bitcoin ETF, Bloomberg Intelligence pros say

article-image

In a bid to woo institutional crypto traders, Binance wants help from a bank

article-image

Musk’s hesitation to launch his own crypto made sense in previous cycles. But there’s no shame left around here — he should just go for it