Standard Chartered’s Libeara to launch tokenized money market fund on Ethereum

Libeara, a tokenization platform developed by SC Ventures, Standard Chartered Bank’s fintech innovation and investment arm., plans to launch a US dollar tokenized money market fund in Singapore. The head of business development at Libeara, Alexandre Deschatres, reportedly disclosed this in an interview with Hong Kong newspaper Xin Bao.

According to the reports, the tokenization platform will launch the fund on Ethereum in partnership with FundBridge Capital, a licensed fund manager in Singapore, and Wellington Asset Management in the US. Deschartres stated that the fund will launch on the Ethereum mainnet, and they will first evaluate the liquidity of US Treasury bonds before proceeding with the launch.

If it goes as planned, this will add another to the growing list of tokenized real-world assets (RWA) issued through Libeara since the platform launched in 2023.

While details of the new money market fund remain uncertain, Libeara has a strong relationship with FundBridge Capital. They launched the first tokenized Singapore-Dollar Government Bond Fund for eligible investors in 2023. Since then, it has been used to issue other tokenized funds on Ethereum, with plans to expand to other chains, including Avalanche, Solana, and Arbitrum.

The platform provides the technology needed to onboard accredited investors, allowing them to subscribe to and redeem units of tokenized funds directly on the chain. The enterprise-grade tokenization platform leverages the expertise and technology of blockchain-native companies such as Fireblocks, Fazz, Chainalysis, Letsbloom, and Chekk.

The tokenization sector continues to grow

Meanwhile, the announcement highlights the continued growth of tokenization, particularly among traditional financial institutions. Demand for tokenized RWA has risen over the last few months, with US treasury bonds accounting for a significant portion of the total tokenized RWA.

This is due to the participation of major firms such as BlackRock, Union Bank of Switzerland (UBS), and Franklin Templeton, as well as the emergence of a more crypto-friendly administration in the US. Many believe that regulatory clarity around stablecoins and cryptocurrencies will boost tokenization efforts.

Interestingly, the total value of RWA on-chain increased by 2.33% to reach $13.54 billion in the last 30 days, while asset holders also increased by 2.46% to reach 66,617. However, this is a mere drop in the ocean compared to the projections of many financial institutions, including Standard Chartered, which expects the sector to be worth $30 trillion by 2030.

Regulators embrace tokenization in several forms

While the $30 trillion projection may seem like a moonshot, recent regulatory developments suggest it is possible. Spanish financial regulator CNMV recently approved the first tokenization issuance in the country, certifying Ursus-3 Capital as Entity Responsible for Registration and Registration (ERIR).

The firm, in partnership with Onyze, will now be able to facilitate the issuance of on-chain tokenized assets on distributed ledger technology (DLT) networks for other companies within the country.

Meanwhile, the Hong Kong Monetary Authority (HKMA) also recently introduced the Digital Bond Grant Scheme (DBGS) to incentivize the growth of tokenized bonds. The grant, up to 2.5 million Hong Kong dollars ($321,200), is offered to eligible issuers of digital bonds in the city.

Beyond that, there are expectations that regulatory clarity on stablecoins, which is already happening worldwide, could also boost the growth of the tokenization sector as regulated stablecoins will be used for real-time settlement of on-chain transactions. In Europe, this clarity has already arrived in the Market in Crypto Assets (MiCA) Act, which provides guidelines for issuing electronic money tokens (EMTs).

Although the US does not yet have clear regulations on stablecoins, many expect this to happen as soon as 2025. Unsurprisingly, analysts have predicted that stablecoins will see massive growth in adoption over the next few years and could soon make up 10% of the US M2 and foreign exchange transactions.

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