Japan's SBI Pilots Commercial Use of Tokenised Securities Via MAS’ Project Guardian

SBI Digital Markets (SBIDM) has launched new pilot projects to advance tokenized securities with the help of initiatives by the Monetary Authority of Singapore’s (MAS) Project Guardian.

SBDIM will craft a framework for cross-border tokenized assets, connecting regulated digital asset exchanges worldwide to increase liquidity and reduce transaction costs, according to an announcement on Tuesday.

The SBIDM Fixed Income pilot will focus on building an international network for trading tokenized asset-backed securities, encompassing both issuance and secondary trading.

A structured note backed by luxury wine assets is also in the works, with other products tied to IP and commodities to follow. Such securites will be accessible in both traditional and digital formats, using a blockchain-agnostic infrastructure to facilitate global transactions.

Furthermore, SBIDM will collaborate with UBS on an Asset and Wealth Management pilot to test a tokenized UBS money market fund within a separate Project Guardian initiative.

This pilot integrates blockchain-powered automation to streamline fund subscription and redemption, reducing operational costs with smart contracts and Chainlink’s Cross-Chain Interoperability Protocol.

On Monday, MAS uunveiled a comprehensive plan to support the commercialisation of asset tokenisation in financial services.

In his opening keynote at the Layer One Summit, part of the Insights Forum 2024, Leong Sing Chiong, MAS Deputy Managing Director (Markets and Development), said that the regulator is "seeing greater momentum towards tokenisation in financial services," citing a range of industry pilots that have been progressing well under Project Guardian.