JPMorgan, DBS Bank, SBI conduct live Defi transactions on public blockchain

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JPMor­gan, DBS Bank and SBI Dig­i­tal Asset Hold­ings have con­duct­ed their first live trans­ac­tions on a pub­lic blockchain using decen­tral­ized finance (defi), tok­enized deposits and ver­i­fi­able cre­den­tials under the super­vi­sion of the Mon­e­tary Author­i­ty of Sin­ga­pore (MAS). Singapore’s cen­tral bank is plan­ning two more pilots involv­ing Stan­dard Char­tered Bank, HSBC and UOB.

JPMorgan, DBS Bank, SBI, Standard Chartered Bank, HSBC, UOB are participating in MAS’ digital asset pilot projects.

The Mon­e­tary Author­i­ty of Sin­ga­pore (MAS), Singapore’s cen­tral bank, announced Wednes­day that “the first indus­try pilot under MAS’ Guardian project, which explores poten­tial appli­ca­tions of decen­tral­ized finance (defi) in whole­sale fund­ing mar­kets, has com­plet­ed its first live trans­ac­tions“.

The announce­ment states that for this pilot:

DBS Bank, JP Mor­gan, and SBI Dig­i­tal Asset Hold­ings con­duct­ed for­eign exchange and gov­ern­ment bond trans­ac­tions against pools of cash includ­ing Sin­ga­pore gov­ern­ment secu­ri­ties tok­enized bonds, Japan­ese gov­ern­ment bonds, Japan­ese yen (JPY) and Sin­ga­pore dol­lars (SGD).

The Sin­ga­pore cen­tral bank’s Project Guardian was announced in May. The reg­u­la­tor explained that since then, it “has engaged the finan­cial sec­tor to iden­ti­fy key areas of collaboration.”

The announce­ment fur­ther reveals:

MAS launch­es two new indus­tri­al pilots.

The first focus­es on trade finance. “Stan­dard Char­tered Bank is lead­ing an ini­tia­tive to explore the issuance of tokens linked to trade finance assets“, DSS not­ed. “The project aims to dig­i­tize the com­mer­cial dis­tri­b­u­tion mar­ket, trans­form­ing com­mer­cial assets into trans­fer­able instru­ments that are more trans­par­ent and acces­si­ble to investors.

The sec­ond pilot focus­es on wealth man­age­ment. “HSBC and UOB work with Mar­ketn­ode to enable native dig­i­tal issuance of wealth man­age­ment prod­ucts, improv­ing issuance effi­cien­cy and acces­si­bil­i­ty for investors“, describes the cen­tral bank.

Sop­nen­du Mohan­ty, Chief Fin­tech Offi­cer of MAS, com­ment­ed, “The live pilots con­duct­ed by indus­try par­tic­i­pants demon­strate that with the right safe­guards in place, dig­i­tal assets and decen­tral­ized finance have the poten­tial to trans­form cap­i­tal mar­kets. This is a big step toward build­ing more effi­cient and inte­grat­ed glob­al finan­cial net­works.“The offi­cial added:

The Guardian project has enabled DSS to deep­en its under­stand­ing of the dig­i­tal asset ecosys­tem and has con­tributed to the devel­op­ment of Singapore’s dig­i­tal asset strategy.

Fol­low­ing the MAS announce­ment, Tyrone Lob­ban, head of blockchain launch and Onyx Dig­i­tal Assets at JPMor­gan, explained on Linkedin that the glob­al invest­ment bank has “exe­cut­ed its 1st LIVE trans­ac­tion on the pub­lic blockchain using defi, tok­enized deposits and ver­i­fi­able cre­den­tials as part of the Mon­e­tary Author­i­ty of Singapore’s (MAS) Guardian project.

He described, “This is a mas­sive step towards a future where finance can take place con­for­mal­ly on the pub­lic blockchain using pub­lic defi pro­to­cols. The begin­nings of insti­tu­tion­al defi are here“. Lob­ban added:

This is the world’s first bank-issued tok­enized deposit and the first trans­ac­tion by reg­u­lat­ed finan­cial insti­tu­tions using W3C-ver­i­fi­able cre­den­tials for defi-com­pli­ant access on the pub­lic blockchain.

To achieve this, we used a mod­i­fied ver­sion of Aave on the Poly­gon Tech­nol­o­gy blockchain to per­form a tok­enized SGD for JPY exchange with SBI Hold­ings LLC. And we built a dig­i­tal iden­ti­ty solu­tion that com­bines iden­ti­ty proofs with trans­ac­tion instruc­tions for “on-chain” ver­i­fi­ca­tion, open­ing up a com­pos­able and plug­gable iden­ti­ty world“, the JPMor­gan exec­u­tive concluded.

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