Written by: Aiying
Recently, Japan's SBI Digital Markets announced that it will strengthen its role in the Singapore Monetary Authority (MAS) "Project Guardian" and launched a new pilot project to promote the use of tokenized securities in the global market. This announcement is not only a strategic layout of the SBI Group subsidiary in the field of financial technology, but also marks its in-depth exploration of asset tokenization and cross-border digital asset transactions. For details, please refer to ([Interpretation] The Commercialization Plan of the Monetary Authority of Singapore's Asset Tokenization)
1. Background of Project Guardian
The Guardian Project is an innovation program launched by the Monetary Authority of Singapore in 2022 to explore the potential of blockchain technology and decentralized finance (DeFi) in the traditional financial system. Through close collaboration with financial institutions and technology companies, the project tests how to effectively apply asset tokenization and DeFi technology in a regulatory environment, hoping to give birth to a new and more resilient financial market structure. Its ultimate goal is to consolidate Singapore's leading position in the global fintech field and lead the innovation and popularization of tokenized assets.
Within the framework of the Guardian Project, the digitization of traditional financial assets is seen as an important way to improve financial efficiency. The essence of tokenized assets is to convert real-world financial assets (such as bonds or real estate) into digital tokens that can be freely traded on the blockchain, thereby increasing the liquidity and market accessibility of these assets. This not only helps reduce intermediary costs, but also improves market transparency and transaction efficiency.
2. SBI Digital Markets’ role and new pilot projects
As an important member of Japan's SBI Group, SBI Digital Markets has played an important role in participating in the "Guardian Project" and continues to expand its influence. SBI Digital Markets is currently working with a number of financial institutions to develop a cross-border framework specifically for tokenized securities. The core goal of this framework is to connect regulated digital asset exchanges in multiple regions to increase the liquidity of tokenized assets and reduce transaction costs. Through this global network connection, SBI Digital Markets hopes to achieve deeper financial market integration, break down barriers between existing markets, and enable tokenized assets to circulate and trade more efficiently around the world.
The newly launched pilot project specifically focuses on the fixed income market and aims to create a global network for tokenized asset-backed securities. This network covers the entire life cycle from initial issuance to secondary market trading. Fixed income assets usually include bonds, mortgage-backed securities, etc., and their tokenization can significantly improve the ease of trading of these traditional assets. SBI Digital Markets is working to optimize all aspects from the issuance of securities to trading through this pilot project, making the transaction cost of tokenized assets lower and more transparent.
At the implementation level, the new pilot project will include initial token offerings (ITOs) and secondary market transactions, which means that investors will be able to participate in the initial issuance of tokenized bonds and then buy and sell them through regulated digital asset exchanges.
3. Global Tokenization Trend and MAS’ Strategic Intentions
Asset tokenization is a means of digitizing real-world assets using blockchain technology. In recent years, asset tokenization has gradually gained attention worldwide because of its potential to increase asset liquidity, reduce transaction costs and improve transparency. However, lack of regulation and market uncertainty remain the main obstacles to large-scale application. Singapore hopes to become a leading center for global asset tokenization through the policy layout of MAS. The potential of asset tokenization has been fully introduced in Aiying's (Real World Assets RWAs Series).
The rise of asset tokenization: Uncovering the exploration of trillion-dollar market opportunities
[RWAs] Infrastructure for tokenizing real-world assets
[RWAs] Current Status and Case Studies of Government Bond Tokenization
[RWAs] Tokenized private credit market and use cases [RWAs] Tokenized commodities and real estate cases
[RWAs] Intellectual Property Tokenization Market and Case Studies
[RWAs] Luxury Collectibles Tokenization Market and Case Studies
[Interpretation of the Bank for International Settlements (BIS) report]: The risks and opportunities of real world assets (RWA) and tokenization
Aiying believes that this move by SBI Digital Markets is a microcosm of the gradual recognition and active adoption of blockchain technology and asset tokenization by global financial institutions. In this process, compliance and standards are not only a problem that must be solved, but also the basis for companies to gain long-term trust. In the future, as the pilot project progresses, Singapore is expected to become one of the global centers for tokenized securities trading, attracting more international capital and financial technology companies.
However, there are still many challenges in promoting this change. For example, how to coordinate regulatory differences between countries? How to ensure the compliance and security of cross-border transactions? These are difficult problems that require further exploration and cooperation. The establishment of tokenized assets and cross-border transaction frameworks requires a fundamental rethinking of the trust mechanism and risk control strategy of the financial system, which is exactly what AIYing is committed to providing Web3 companies with in-depth compliance consulting and solutions.