Chainlink, UBS Asset Management, and Swift complete a pilot project to extract cash from tokenized funds
The pilot project was carried out as part of the Guardian Project of the Monetary Authority of Singapore.
Blockchain company Chainlink, global financial messaging platform Swift, and the asset management unit of Swiss bank UBS announced that they successfully concluded a pilot test of the ability to settle and redeem fiat cash from tokenized funds.
The project, completed as part of the Guardian Project of the Monetary Authority of Singapore (MAS), demonstrated how Swift's infrastructure can facilitate cash settlements off-chain for tokenized funds. It also shows how tokenization and blockchain can work to enhance, not replace, Swift, which connects over 11,500 financial institutions in more than 200 countries.
As Singapore and other jurisdictions around the world offer more tokenized funds, the ability to obtain quick and efficient access to cash (which is what the multibillion-dollar traditional finance (TradFi) industry wants to establish) is important.
"I think this shows where we are headed with our work with Swift and how it can be useful for various parts of the financial services industry," said Sergey Nazarov, co-founder of Chainlink, in an interview.
Nazarov stated that the pilot allows the vast market of TradFi investors to subscribe to tokenized funds through a Swift transfer they are already familiar with, rather than a stablecoin, a central bank digital currency (CBDC), or another digital asset.
"We have been emphasizing the need for the large institutional market, where most of the world's value currently resides, to flow into the blockchain industry for years. Now we are helping to facilitate this transition in a reliable, technical, and secure manner," Nazarov said.
