Deutsche Bank Joins Singapore’s Project Guardian to Explore Asset Tokenization and DeFi Applications

Deutsche Bank has recently become a participant in the Monetary Authority of Singapore’s Project Guardian, a venture aimed at exploring the potential of asset tokenization within wholesale funding markets and the realm of decentralized finance (DeFi). This initiative seeks to delve into the various applications of asset tokenization, encompassing processes such as listing, distribution, trading, settlement, and asset servicing. This move by Deutsche Bank follows its issuance of a report on stablecoins, where it voiced concerns over the transparency of major issuers like Tether, a claim Tether disputed due to a perceived lack of evidence. As part of Project Guardian, Deutsche Bank intends to experiment with an open, interoperable blockchain platform dedicated to the servicing of tokenized and digital funds, while also suggesting protocol standards and collaborating with Memento Blockchain, a software platform focused on DeFi and digital asset management. The project will be led by Boon-Hiong Chan, the head of securities and technology for Deutsche Bank in the Asia Pacific region.

In previous collaborations, Deutsche Bank and Memento Blockchain worked together on Project DAMA (Digital Assets Management Access) during 2022 and 2023, successfully demonstrating a proof-of-concept. This project aimed to develop a digital fund management and investment servicing solution that is more efficient, secure, and adaptable. Building on this, Deutsche Bank plans to launch DAMA 2, leveraging the development capabilities of Interop Labs, the creators of the Axelar network. In a related development, Ripple partnered with the Axelar Foundation in February to improve interoperability on the XRP Ledger blockchain, with a focus on facilitating the tokenization of real-world assets. The past year has seen a notable increase in protocols for the tokenization of real-world assets, accumulating over $8 billion in total value locked. Political entities are increasingly advocating for regulatory frameworks that support the cryptocurrency sector. The UK’s Labour Party has committed to establishing the UK as a global center for crypto asset technology, while in the US, the upcoming election has seen the Trump administration critique the Biden administration’s regulatory stance on crypto.

Citi Group, an investment bank, projected that by 2030, the global value of tokenized assets could reach nearly $4 trillion. This projection is supported by the Labour Party’s governance in the UK, which aims to position the country as a leader in tokenization by clarifying relevant laws and collaborating with regulators to oversee the technology. Meanwhile, the US is also positioning itself as a proponent of the crypto industry in its forthcoming election, with the Trump administration advocating for policies that support the sector and prevent the exodus of businesses. Deutsche Bank’s engagement in Project Guardian, alongside its partnership with Memento Blockchain and other industry stakeholders, underscores the burgeoning interest in asset tokenization and its potential for expansive growth. With the increasing adoption of RWA tokenization protocols and the backing of political parties and governments globally, the future of asset tokenization appears to be on a promising trajectory.