In exploration to use cases of digital assets in tokenization and decentralized finance (DeFi), the Monetary Authority of Singapore (MAS) is starting a pilot alongside financial heavyweights DBS, JPMorgan (JPM) and Marketnode.
- Using open, interoperable networks, the project aims to explore the feasibility of tokenization and DeFi, enabling digital assets to be traded across platforms, including existing financial infrastructure, Singapore’s central bank announced on Tuesday.
- In the first stage of “Project Guardian”, MAS will explore DeFi applications in wholesale funding markets through the creation of a liquidity pool of tokenized bonds and deposits to carry out borrowing and lending on a public blockchain-based network.
- DBS and JPMorgan both have a tracking history of building digital assets and blockchain technology into their wholesale banking operations.
- DBS released a S$15 million (US$11.3 million) digital bond in a security token offering (STO) a year ago. Since its launch in 2020, JPMorgan’s Onyx Digital Assets Network has now completed over $300 billion of transactions. It uses tokens for trading in fixed income markets.
- By leveraging these developments, a major financial center could provide support to the adoption of digital assets and blockchain by mainstream financial institutions.