Financial institutions on Wall Street are increasingly focused on industrializing proofs-of-concept developed within the blockchain experiment Project Guardian. JPMorgan’s Onyx platform is looking to convert the insights gained from its pilot program with the Monetary Authority of Singapore into tangible products, with a key area of focus being investment fund tokenization. WisdomTree, another traditional firm heavily invested in blockchain-enabled finance migration, is exploring real-world asset tokenization for investor portfolios through portfolio personalization and blending portfolios with checking accounts. The company aims to integrate various financial services into a single application to allow clients to use their money more effectively. WisdomTree is also involved in Project Guardian, which seeks to explore decentralized finance (DeFi) applications and asset tokenization in wholesale funding markets with other major participants like DBS Bank, SBI Digital Asset Holdings, and JPMorgan.
The value of tokenized funds has surged from $100 million to approximately $800 million, driven by the rising tokenization of U.S. treasuries. Public and private blockchains are witnessing the inclusion of various assets, with examples like Franklin Templeton’s U.S. Government Money Fund expanding to different blockchain platforms, Backed Finance launching a tokenized short-term U.S. treasury bond ETF, and UBS Asset Management deploying a tokenized money market fund on the Ethereum blockchain. Moody’s, a leading investment risk assessment firm, emphasizes the potential of tokenized MMFs to combine their stability with the technological advantages of stablecoins. Recent developments include Singapore-based DigiFT launching US Treasury bill depository receipt (DR) tokens and Turkey’s Misyon Bank partnering with Swiss firm Taurus for digital asset custody and tokenization technology.
At TokenizeThis event held in Miami, JPMorgan’s Onyx product manager highlighted the company’s focus on industrializing their PoCs in partnership with the Monetary Authority of Singapore. Key areas of focus include investment fund tokenization to create tangible products out of proof-of-concepts developed through blockchain experiments. WisdomTree, an asset manager heavily invested in blockchain-enabled finance migration, is exploring real-world asset tokenization for investor portfolios to offer a myriad of allocation variations and risk profiles. The company is also working on integrating various financial services into a unified interface to allow clients to use their money more effectively. Participating in Project Guardian, JPMorgan, DBS Bank, SBI Digital Asset Holdings, and WisdomTree are collaborating to assess the feasibility of DeFi and asset tokenization on a larger scale.
Project Guardian, launched in May 2022, focuses on developing open and interoperable networks, institutional-grade DeFi protocols, asset tokenization, and trusted infrastructure. The initiative aims to explore the potential of DeFi applications and asset tokenization in wholesale funding markets, with significant participants like JPMorgan, DBS Bank, SBI Digital Asset Holdings, and WisdomTree working together to drive innovation in the financial industry. The tokenization of funds has gained popularity in recent years, driven by the increasing tokenization of U.S. treasuries and the inclusion of various assets on both public and private blockchains. Major firms like Franklin Templeton, Backed Finance, UBS Asset Management, DigiFT, and Misyon Bank have been actively involved in launching tokenized funds and exploring the potential of tokenization technology for financial services.
