S&P Global has joined Singapore’s Project Guardian token trials.
S&P Global Ratings is the latest institution to join the Monetary Authority of Singapore's (MAS) giant project watchdog. The two-year project examines the role that asset tokenization plays in the efficiency of financial markets.
Project Guardian seeks to establish standards and policy guidelines and develop a business-focused digital asset ecosystem. S&P Global participates in fixed income pilot projects. Andrew O'Neill, head of analysis at S&P Digital Assets, said in a statement:
“We aim to bring our risk perspective and understanding to this platform to support robust risk mitigation as this technology is applied in financial markets.”
Project Guardian S&P offers a lot to see
In fixed income pilots, institutions are conducting foreign exchange and bond transactions in tokenized bonds and currencies. They are also making purchase agreements with digital bonds, a listing framework for debt securities, and an initial token offering for digital tokens listed on the Singapore Exchange.
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Other workflows of the project include wealth management and foreign exchange on public blockchains, which address network interoperability. The project uses a modular network model with four components.
Project Guardian was launched by MAS in May 2022, with JP Morgan, DBS Bank and SGX Venture Markets as initial participants. S&P Global has become the 24th member of Project Guardian's industry group, which consists mainly of large banks and asset managers.
The group of policymakers includes government officials from the United Kingdom, Japan, Singapore, Switzerland and France, as well as the International Monetary Fund. There is also a three-member International Associations Group.
The project manager token will be prioritized
As part of Project Guardian, JPMorgan has implemented live cross-border trading in November 2022 using tokenized Singapore dollars and Japanese yen on the Polygon blockchain. It was the first major bank to conduct decentralized financial transactions on a public blockchain.
One of the innovations that could come out of the project is a deposit token – a form of Statcoin “issued by regulated and sufficiently regulated intermediaries”. The Swiss Bankers Association and JP Morgan have found advantages in deposit tokens for their stability and as a way to integrate central bank digital currency into the traditional banking system.
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