November 17, 2023
By Sharan Kaur Phillora
The Monetary Authority of Singapore (MAS) has recently initiated five additional industry pilots under Project Guardian, focusing on various aspects of asset tokenization. This initiative, led by Singapore’s central bank, aims to develop a new financial infrastructure incorporating decentralized finance (DeFi) elements. The primary goal of these initiatives is to establish foundational capabilities that would allow for the scaling of tokenized markets.
Project Guardian stands as a testament to MAS’s commitment to innovation in the financial sector. It seeks to catalyze the institutional adoption of digital assets, aiming to enhance liquidity, unlock new investment opportunities, and improve the efficiency of financial markets.
Among the 17 financial institutions participating in Project Guardian are notable names such as Citi, T. Rowe Price, Fidelity International, Ant Group, BNY Mellon, OCBC, Franklin Templeton, JPMorgan, and Apollo. These institutions are involved in various pilot projects. For instance, Citi, T. Rowe Price, and Fidelity International are exploring bilateral digital asset trade mechanisms and real-time post-trade reporting and analytics of digital asset trades. Ant Group is working on a treasury management solution to enhance global liquidity management funding.
Moreover, BNY Mellon and OCBC are engaged in testing a cross-border foreign exchange payment solution designed for heterogeneous networks. Franklin Templeton is experimenting with the issuance of a tokenized money market fund using a variable capital company (VCC) structure. In collaboration, JPMorgan and Apollo are addressing the cumbersome manual processes associated with asset servicing through the use of digital assets.
In addition to these pilots, MAS has launched the Global Layer One initiative to explore the creation of an open digital infrastructure capable of hosting tokenized financial assets and applications. This development is part of a broader effort to foster a common framework for exchanging digital assets across independent networks among financial institutions.
The International Monetary Fund has also been included as one of the policymakers of Project Guardian, highlighting its global significance and potential impact on the financial sector.
This ambitious project underscores Singapore’s position as a leader in financial technology and its commitment to exploring the potential of digital assets and tokenization. By fostering collaborations between major financial institutions and leveraging cutting-edge technologies, Project Guardian is set to play a pivotal role in shaping the future of finance, not just in Singapore but globally.
About the author
Sharan Kaur Phillora’s thirst for knowledge has led her to study many different subjects, including NFTs and Blockchain technology – two emerging technologies that will change how we interact with each other in the future. When she isn’t exploring a new idea or concept, she enjoys reading literary masterpieces.