Monetary Authority Of Singapore And Industry Giants Forge Ahead With Tokenization Pilots

The Monetary Authority of Singapore (MAS) on Wednesday announced that it has partnered with major financial institutions to broaden asset tokenization initiatives.

This move, part of Project Guardian, seeks to transform the institutional use of digital assets, promising increased liquidity, investment opportunities, and enhanced efficiency in financial markets.

Project Guardian's New Pilots: Under Project Guardian, 17 financial institutions are testing five new tokenization applications. These include improving digital asset trading mechanisms (Citi, T. Rowe Price, and Fidelity International), developing interoperable cross-border FX payment solutions (BNY Mellon and OCBC), and a multi-currency treasury management system (Ant Group).

Focus On Fund Management Digitalization: MAS has initiated a segment for issuing Variable Capital Company (VCC) funds on digital networks, addressing tax, policy, and legal aspects to adapt digital solutions in fund management.

Global Layer One (GL1) Initiative: MAS is working with international entities, including BNY Mellon BK, DBS, JP Morgan JPM, and Mitsubishi UFJ Finl MUFG, to create GL1, a digital infrastructure to support and trade tokenized assets while complying with regulatory standards.

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Interlinked Network Model (INM): The INM, developed by MAS, aims to enable transactions across independent digital networks.

A whitepaper, collaboratively developed by financial institutions and FinTechs, details its application and design.

IMF's Involvement In Project Guardian: The IMF joins Project Guardian’s policymaker group to provide insights on the international policy framework for cross-border digital platforms.

Leong Sing Chiong of MAS highlighted Project Guardian's success in demonstrating the trading and settlement potential of tokenized assets, underscoring the need for scalable digital infrastructure like GL1.

Leong has invited additional policymakers and financial institutions to participate in the GL1 initiative, shaping its development and future.

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