Investors hoping to achieve more stable and consistent yields in the DeFi market may have finally found what they’re looking for in the shape of Zoth’s newest tokenized asset.
Zoth said today it’s partnering with Singularity Finance to launch a new DeFi product for institutional investors called Zoth Tokenized Liquid Notes Prime, or ZTLN-P. It’s a tokenized asset that’s primarily backed by U.S. Treasury ETFs and Money Market Funds, bringing them on-chain, with the promise of easy access and more consistent returns.
Zoth provides the sophisticated treasury management know-how that’s required to optimize DeFi yields. It’s utilizing Singularity’s SFI tokenization framework to ensure ZTLN-P is built on a fully compliant infrastructure that’s backed by a robust legal structure and sufficient liquidity, enabling investors to redeem their tokens at any time. With Zoth’s deep expertise in tokenizing traditional financial instruments, the collaboration promises institutions and asset managers an easy-to-access investment that will generate stable returns, similar to traditional treasury investments.
Zoth explains that ZTLN-P puts a priority on liquidity, safety and transparency, and in this way it claims to be setting a new standard for institutional DeFi investments. ZTLN-P is a blockchain-based digital asset that’s designed to generate optimized yield at low risk, without encumbering investors with lock-in periods, instead giving them the flexibility to enter and exit a position at any moment. It’s backed by a combination of Blackrock-managed ETFs and MMMs that largely hold U.S. Treasury bills, and it’s designed to deliver the kinds of predictable, low-risk yields that asset managers yearn for during periods of economic uncertainty.
It chose Singularity’s SFI framework because it adheres to the Cayman Island’s Monetary Authority (CIMA) and the Mutual Funds Act (2021 Revision), making ZTLN-P a regulatory compliant asset that’s both secure and accessible. This, combined with what Zoth says is "unparalleled liquidity”, should make ZTLN-P an enticing option for investors seeking more stable asset classes in a traditionally highly-volatile DeFi industry.
The announcement underscores the growing desire for tokenized MMFs, which have grown to more than $2.3 billion in value over the last year, driven partly by the flexibility of blockchain technology and the prospects of stable returns. Zoth’s ZTLN-P will compete with products like BlackRock’s USD Institutional Digital Liquidity Fund or BUIDL, which is also backed by Treasury notes and provides on-chain yield, dividend accrual and distribution, and flexible custody options 24/7. Other tokenized funds include Franklin Templeton’s $420 million Franklin OnChain U.S. Government Money Fund (FOBXX) on the Avalanche blockchain.
Zoth says its focus on low-risk and high liquidity can help to position ZTLN-P as the new “gold standard” for tokenized assets, with strong guarantees that investors’ capital is deployed in a highly-vetted investment strategy that’s designed to generate steady gains while preserving their principal.
Zoth Chief Executive Pritam Dutta said ZTLN-P represents one of the first institutional-grade short-term investments to leverage the efficiency and transparency of blockchain infrastructure, paving the way for a new era of DeFi. No longer will DeFi be seen as a speculative market, “but a legitimate alternative to traditional finance,” he said.
Singularity Finance co-founder Mario Casiraghi said ZTLN-P embodies safety, liquidity and transparency. “This partnership sets a new standard for on-chain financial solutions, ensuring institutional investors can confidently navigate the DeFi space while enjoying consistent, low-risk returns,” he added.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.