The Monetary Authority of Singapore (MAS) has announced the commencement of a series of asset tokenization pilots in collaboration with prominent financial services institutions. This initiative is an extension of the ambitious Project Guardian, which involves 17 financial institutions.
Exploring Use Cases in Asset Tokenization
The collaborative efforts aim to explore various use cases in asset tokenization, including listing, distribution, trading, settlement, and asset servicing. MAS will work together with international policymakers and banking giants such as BNY Mellon, DBS, JP Morgan, and MUFG to achieve this goal. The ultimate objective is to design an open, digital infrastructure known as Global Layer One (GL1) to support tokenized financial assets.
Leong Sing Chiong, Deputy Managing Director at MAS, highlights the significance of a scalable digital infrastructure, stating that it is crucial to “fully realize the potential of tokenized markets and achieve network effects.” He adds, “GL1 will provide a foundational digital backbone and bring markets together with similar principles of openness and accessibility as the public internet.”
The central bank of Singapore plans to examine bilateral crypto trades, clearing and settlement in multiple currencies, and fund management through these pilot tests. Notable institutions such as Citi, T. Rowe Price, and Fidelity International are exploring real-time post-trade reporting and analytics of digital asset trades. Additionally, BNY Mellon and OCBC banks are testing a cross-border FX payment product, while Ant Group is testing a treasury management service for real-time clearing and settlement. Franklin Templeton, a leading asset management company, is also participating in the pilots, focusing on the issuance of a tokenized money market fund through a variable capital company (VCC) structure.
Expanding Investment Opportunities with Digital Assets
J.P. Morgan and Apollo are collaborating on leveraging digital assets for further investment and management of discretionary portfolios in one of the final pilot tests. Alongside these initiatives, MAS has also announced the launch of a new Project Guardian funds workstream, which will concentrate on the native issuance of Variable Capital Company (VCC) funds on digital asset networks.
