Ethereum-based DigiFT Receives License to Develop Digital Securities (RWA) Market in Singapore

adminDecember 5, 2023

Issuing and distributing digital securities on Ethereum
DigiFT, which operates a real world asset (RWA) token trading platform on Ethereum, received a Capital Market Services (CMS) license from the Monetary Authority of Singapore (MAS) on the 5th, allowing it to act as a market operator (RMO). received. ). He presented what he had learned.
This makes it possible to officially provide both primary markets (issuance and distribution) and secondary markets (distribution and trading) for digital securities (security tokens: ST).
DigiFT is authorized to issue financial instruments, such as securities and beneficiary certificates of joint investment schemes, and to supervise and operate trading in such instruments within Singapore.
Founded in 2021, DigiFT operates an exchange with an automated market making (AMM) mechanism that uses smart contracts to automate market making. The company joined MAS’ fintech regulatory sandbox in June 2022 to facilitate the issuance of digital securities and operate a secondary market management market.
Connect: What is an Automated Market Maker (AMM)? Mechanism and Risk Description
Aiming to expand the digital securities market
The platform is built on the Ethereum blockchain and provides a liquidity pool mechanism for secondary trading of RWA-backed digital securities such as bonds, stocks, and joint investment schemes.
Investors can purchase, trade and redeem on-chain assets with fiat and stablecoins through DigiFT’s website and mobile app.
“Obtaining CMS license and RMO recognition is an important step in enabling regulated access to on-chain financial opportunities,” said CEO Henry Zhang.
DigiFT is bridging the gap between traditional finance and blockchain technology by integrating RWA tokenization. In the future, the company plans to expand the regional launch of its mobile app and improve the user experience for investors by providing features such as on-chain asset public proof and cross-chain distribution. We also provide access to compliant real-world assets and work with publishers to expand their product offerings.
CEO Henry praised Singapore as a leading hub for financial services and innovation. He said that as DigiFT, we will “focus on building the next generation of capital markets”, starting with licensing this renowned financial hub.
Connect: Introduction to Digital Securities: A Guidebook for Capturing the New Investment Wave
What are real assets?
Real assets refer to assets and rights that exist in the real world. It includes not only traditional financial assets such as gold, real estate, stocks, and bonds, but also intangible assets such as carbon credits, copyrights, and corporate brands. By tokenizing this into a common standard, effects such as improved accessibility for market participants, improved compatibility between markets, improved liquidity of each asset, and reduced financial transaction costs can be expected.
In particular, the precedent for RWA tokenization is the ‘US Treasury Tokenization’ market. With the rise in U.S. Treasury yields in 2023, the total value deposited (TVL) in this market protocol increased from about $100 million at the beginning of the year to $785 million (about $110 billion) as of December 5. Tokenized U.S. Treasury bonds have the same characteristics as regular U.S. Treasury bonds, including an average interest rate of over 5% and return of principal at maturity.
Connect: Why are investors interested in tokenizing real assets and what are real world assets (RWA)?
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