First Mover Americas: Singapore Central Bank Tests Tokenization Alongside JPMorgan, BNY Mellon

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Singapore's central bank is starting to test tokenization use cases alongside major traditional finance players including JPMorgan, DBS, and BNY Mellon. The tests will examine bilateral digital asset trades, foreign currency payments, multicurrency clearing and settlement, fund management and automated portfolio rebalancing, the Monetary Authority of Singapore (MAS) said Wednesday. JPMorgan and Apollo have carried out a "proof of concept" to demonstrate how asset managers could tokenize funds on the blockchain as part of the project, the firms announced concurrently with MAS' statement. The initiative is part of Project Guardian, a policymaker group that includes Japan's Financial Services Agency (FSA), the U.K's Financial Conduct Authority (FCA) and the Swiss Financial Market Supervisory Authority (FINMA) to advance asset tokenization.

OKX, the second-largest cryptocurrency trading platform, is providing derivatives trading without the counterparty risk associated with assets being held on the exchange, enriching an existing arrangement with asset manager CoinShares and custody joint venture Komainu. Since FTX blew up last year, a number of players in the crypto space have devised ways to trade and settle off-exchange from the safe confines of a trusted custody setup. Off-exchange settlement is relatively easily done for spot markets, said Lewis Fellas, the head of hedge-fund solutions at CoinShares. A big differentiator, he said, is providing a similar arrangement when it comes to derivatives trading.

SC Ventures, the fintech investment and venture arm of banking group Standard Chartered, announced new tokenization platform on Tuesday. Libeara will enable the creation of a tokenized Singapore dollar government bond fund for accredited investors, according to the announcement. The platform has also partnered with FundBridge Capital, an organization for fund managers in Singapore. By working with Libeara "we are ensuring that we can provide additional investment opportunities enabled by lower operating costs, higher transparency and higher operational efficiency,” Sue Lynn Lim, CEO and COO of FundBridge Capital said in a statement.

- Omkar Godbole