The Monetary Authority of Singapore has announced a new project for researching use cases for decentralized finance on public blockchains.
Project Guardian will reportedly be implemented in partnership with JPMorgan, Marketnote, and DBS. The project aims to collaborate with the financial sector to look into the economic aspect and asset tokenization.
The regulator has defined asset tokenization as the process of representing value through smart contracts in a blockchain. The function enables financial and economic assets to be fractionalized and exchanged.
Project Guardian is set to test the feasibility of application in asset tokenization and DeFi and create pilot use based on interoperability, trust anchors, networks, institutional level DeFi, and asset tokenization.
The initial pilot in the program will see the creation of a permissioned liquidity pool that will have tokenized bonds and deposits to enable secured borrowing and lending on public blockchains.
The group head of planning and strategy at DBS, Han Kwee Juan, says that the project will enhance innovation and scale institutional and financial applications on blockchains.
Source: Monetary Authority of Singapore