The first stage of “Project Guardian”, which is being led by DBS, JPMorgan and Marketnode, will see MAS explore DeFi applications in wholesale funding markets.
The Monetary Authority of Singapore (MAS) is starting a pilot alongside financial heavyweights DBS, JPMorgan (JPM) and Marketnode, to explore use cases of digital assets in tokenization and decentralized finance (DeFi).
The project will explore the feasibility of tokenization and DeFi using open, interoperable networks, enabling digital assets to be traded across platforms, including existing financial infrastructure, Singapore’s central bank announced on Tuesday.
The first stage of “Project Guardian” will see MAS explore DeFi applications in wholesale funding markets through the creation of liquidity pool of tokenized bonds and deposits to carry out borrowing and lending on a public blockchain-based network.
Both DBS and JPMorgan have track records of building digital assets and blockchain technology into their wholesale banking operations.
A year ago, DBS issued a S$15 million (US$11.3 million) digital bond in a security token offering (STO). JPMorgan’s Onyx Digital Assets Network, which uses tokens for trading in fixed income markets, has now completed over $300 billion of transactions since its launch in 2020.
Building on these developments in step with the central bank of a major financial center could provide fresh impetus to the adoption of digital assets and blockchain by mainstream financial institutions.