Leading financial institutions on Wall Street are shifting their focus towards industrializing proofs-of-concept (PoCs) developed within the blockchain experiment known as Project Guardian.
JPMorgan’s blockchain platform, Onyx, is particularly keen on converting the insights gained from its pilot program with the Monetary Authority of Singapore (MAS) into tangible products.
During the TokenizeThis event held in Miami on May 10, Stephanie Lok, product manager of JPMorgan’s Onyx, said the company is focused on investment fund tokenization as a key area of focus.
“That’s a very big focus area: how can we kind of productionize, industrialize what we built out as a proof-of-concept?” Lok stated.
WisdomTree Highlights Interest in RWA Tokenization
Another traditional firm heavily invested in blockchain-enabled finance migration is WisdomTree, an asset manager.
Maredith Hannon, head of business development for WisdomTree, highlighted the company’s interest in portfolio personalization and blending portfolios with checking accounts.
Hannon further elaborated on the potential benefits of real-world asset tokenization for investor portfolios, envisioning the ability to create a myriad of allocation variations and risk profiles.
WisdomTree is also exploring the provision of different on-chain services through a unified interface for its clients.
The company aims to integrate various financial services, including tokenized portfolios and traditional banking services, into a single application.
“Deliver that end value of being able to use your money more effectively. Being able to be in the market, in a money market fund earning 5% versus earning pretty much nothing in your checking account.”
As a prominent asset manager involved in Bitcoin exchange-traded funds (ETFs), WisdomTree brings its expertise and experience to the Project Guardian initiative.
Launched in May 2022, Project Guardian seeks to explore decentralized finance (DeFi) applications and asset tokenization in wholesale funding markets.
The initiative focuses on developing open and interoperable networks, institutional-grade DeFi protocols, asset tokenization, and trusted infrastructure.
JPMorgan, DBS Bank, SBI Digital Asset Holdings, and WisdomTree are the main participants in Project Guardian, collaborating to assess the feasibility of DeFi and asset tokenization on a larger scale.
Tokenized Funds Continue to Gain Popularity
In a report earlier this year, Moody’s, a leading investment risk assessment firm, revealed the value of tokenized funds surged from $100 million at the beginning of 2023 to approximately $800 million, driven by the rising tokenization of U.S. treasuries.
The report highlighted that both public and private blockchains are witnessing the inclusion of various assets.
Some of the more notable examples include Franklin Templeton’s U.S. Government Money Fund expanding from Stellar to Polygon, Backed Finance launching a tokenized short-term U.S. treasury bond exchange-traded fund (ETF), and UBS Asset Management deploying a tokenized money market fund (MMF) on the Ethereum blockchain.
According to Moody’s, the tokenization of MMFs offers the potential to combine their stability with the technological advantages of stablecoins.
Just recently, DigiFT, a Singapore-based fintech company, also announced the launch of its US Treasury bill depository receipt (DR) tokens.
Likewise, Turkey’s Misyon Bank has announced its partnership with Swiss firm Taurus to leverage its digital asset custody and tokenization technology.
