UBS Asset Management, a global wealth manager, has initiated the inaugural live pilot of a tokenized Variable Capital Company (VCC) fund, marking a significant milestone in implementing Project Guardian. This venture is embedded within a broader VCC umbrella, strategically crafted to integrate diverse real-world assets onto the Ethereum (ETH) blockchain seamlessly.
Scope of the VCC Fund of UBS
As per the announcement, the pioneering tokenized VCC fund represents a forward leap in digital assets management, emphasizing the transformative potential of blockchain technology in the financial sector. As a pivotal component of Project Guardian, this initiative is steered by the Monetary Authority of Singapore (MAS), underscoring its collaborative nature within the industry.
Interestingly, the fund is the first amongst several live pilots UBS intends to launch. The essence of tokenization lies in converting real-world assets, traditionally bound by physical constraints, into digital tokens on the blockchain. UBS Asset Management’s live pilot of the VCC fund exemplifies this transition, enabling a dynamic and secure representation of assets on the blockchain.
Also, this move aligns with the broader industry trend of harnessing blockchain’s efficiency, transparency, and accessibility. The pilot is designed to permit the investment bank to engage in several fund activities including subscriptions and redemption. This resonates with the overarching goal of Project Guardian- to bridge the gap between traditional finance and the blockchain-powered future. The success of this pilot is not merely a triumph for the company but also a testament to the viability and acceptance of tokenized VCC funds in the wider financial landscape.
Fintech Companies Embracing Tokenization
Just last month, fintech Taurus announced the expansion of its digital asset custody and tokenization services to support private blockchains, not exempting the public ones.
The expansion means that Taurus’ global clients can now tokenize any type of asset on public and private blockchains via the same platform, enabling interoperability benefits of bridging assets between private and public chains.
Meanwhile, Taurus’ expansion follows its partnership with the banking giant Deutsche Bank which manages over €1.3 trillion ($1.4 trillion) in assets to provide digital asset custody and tokenization services to its institutional clients.