The Monetary Authority of Singapore (MAS) has unveiled a plan to advance asset tokenization in the financial services sector. This initiative aims to support the commercialization of products and services under Project Guardian.
MAS is introducing new regulatory measures to promote tokenization, with a focus on building commercial networks, enhancing market infrastructure, and establishing standardized frameworks for tokenized assets.
In addition, Project Guardian facilitates the commercialization of tokenized products by integrating offerings from various participants across multiple asset classes. This approach is expected to improve capital raising, secondary trading, asset servicing, and settlement processes for tokenized assets.
Several prominent financial institutions, including Citi, HSBC, Schroders, Standard Chartered, and United Overseas Bank (UOB), have formed the Guardian Wholesale Network industry group. This group aims to create a multi-member network to commercialize asset tokenization initiatives and scale their application.
Leong Sing Chiong, Deputy Managing Director of MAS, expressed optimism, stating:
“We are encouraged by the keen participation from financial institutions and fellow policymakers to co-create industry standards and risk management frameworks to facilitate the commercial deployment of tokenized capital markets products and scale tokenized markets on an industry-wide basis.”
Implementing Tokenization
Project Guardian has developed two industry frameworks to guide the implementation of tokenized assets by financial institutions. The first, the Guardian Fixed Income Framework (GFIF), incorporates the International Capital Market Association’s Bond Data Taxonomy, the Capital Markets and Technology Association’s Token Standards, and the Global Financial Markets Association’s Design Principles for Tokenized Securities. This framework provides industry guidance for applying tokenization in Debt Capital Markets and promotes the adoption of tokenized fixed-income solutions.
The second, the Guardian Funds Framework (GFF), outlines best practices for tokenized funds, including the Guardian Composable Token Taxonomy to support the development of multi-asset tokenized investment vehicles.
Additionally, in 2023, MAS launched the Global Layer One (GL1) initiative, a foundational digital infrastructure for cross-border classification of tokenized commercial networks. Major global banks such as BNY Mellon, Citi, J.P. Morgan, MUFG, and Societe Generale-FORGE are collaborating on the GL1 platform, which addresses governance, risk management, legal, and technology requirements to foster a robust tokenized financial ecosystem.
