Japan’s SBI and UBS Complete Tokenised Fund Pilotby Fintech News Singapore October 31, 2023
SBI Digital Markets, the digital asset arm of Japanese conglomerate SBI Group, and UBS Asset Management have completed a technical pilot for the issuance and distribution of a tokenised Variable Capital Company (VCC) fund.
This is a part of the Monetary Authority of Singapore’s Project Guardian, a collaborative industry initiative that seeks to test the feasibility of applications in asset tokenisation and decentralised finance (DeFi) while managing risks to financial stability and integrity.
The pilot was executed on a permissioned environment of the Ethereum network. As part of the pilot, SBI Digital Markets and UBS Asset Management tested various scenarios between fund manager, distributor, and digital asset custodian all acting as trust anchors.
The subscription and redemption of fund shares were simulated on the network by both parties through their standalone digital asset technology setups, with smart contracts in place to bring about automation and efficiencies.
In the next stage, SBI Digital Markets aims to continue working with a wider set of ecosystem participants under Project Guardian to explore possible commercialisation models for tokenised funds.
Winston Quek, Chief Executive Officer of SBI Digital Markets said,
“Our vision for the future of capital markets is one where institutions can leverage digitalisation and efficiency-enhancing technology to unlock data and cost efficiencies.
The success of our technical pilot with UBS Asset Management marks the first of more to come – we will be stepping up our global partnerships to build an open and interoperable network for digital assets.”