Swiss bank UBS has launched the first live pilot of a tokenized money market fund on the Ethereum blockchain in Singapore. This is part of Project Guardian, an initiative to tokenize real-world assets that is overseen by Singapore’s central bank.
The tokenized fund is a Variable Capital Company (VCC), a type of investment fund structure introduced in Singapore in 2020. UBS says this launch marks a key milestone in exploring asset tokenization.
Through smart contracts on Ethereum, the pilot allows UBS to handle activities like subscriptions and redemptions for the fund. UBS plans to expand its tokenized offerings under Project Guardian and pursue more partnerships involving different investment strategies.
UBS has already made significant progress with tokenization services. In November, it issued the world’s first digital bond traded on public markets. In December, it launched a $50 million tokenized note, and in June it helped the Bank of China Investment issue 200 million yuan ($27.3M) in tokenized structured notes on Ethereum.
While still new, UBS’ tokenized services and funds could reshape digital asset and financial markets in the coming years. The firm aims to improve liquidity and accessibility for investors through tokenization.
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