UBS Asset Management has launched its first live pilot of a tokenized Variable Capital Company (VCC) fund. The fund is part of a wider VCC umbrella designed to bring various “real world assets" on-chain as part of Project Guardian, a collaborative industry initiative led by the Monetary Authority of Singapore (MAS).
Thomas Kaegi, Head UBS Asset Management, Singapore & Southeast Asia, said: “This is a key milestone in understanding the tokenization of funds, building on UBS’s expertise in tokenizing bonds and structured products. Through this exploratory initiative, we will work with traditional financial institutions and fintech providers to help understand how to improve market liquidity and market access for clients.”
Utilizing the firm’s in-house tokenization service, UBS Tokenize, UBS Asset Management launched this controlled pilot of a tokenized money market fund. Represented as a smart contract on the Ethereum public blockchain, the pilot enables UBS Asset Management to carry out various activities including fund subscriptions and redemptions.
This pilot is part of UBS Asset Management’s global distributed ledger technology strategy, focused on leveraging public and private blockchains networks for enhanced fund issuance and distribution. It also forms part of the broader expansion of UBS’s tokenization services through UBS Tokenize. In November 2022, UBS launched the world’s first digital bond that is publicly traded. In December 2022, UBS issued a USD 50 million tokenized fixed rate note, and in June 2023 originated CNH 200 million of fully digital structured notes for a 3rd party issuer.
Following the successful launch of the first pilot transactions, UBS Asset Management will be looking to execute further live pilot use cases under Project Guardian – working with a wider set of partners and explore various investment strategies.
UBS is the largest truly global wealth manager and the leading universal bank in Switzerland. It also provides large-scale and diversified asset management solutions and focused investment banking capabilities. UBS helps clients achieve their financial goals through personalized advice, solutions and products. Headquartered in Zurich, Switzerland, the firm has operations and offices around the globe. UBS shares are listed on the SIX Swiss Exchange and the New York Stock Exchange (NYSE).
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