Issuing and distributing digital securities on Ethereum
DigiFT, which operates a trading platform for Real World Assets (RWA) tokens on Ethereum, on the 5th received a capital market services (CMS) license from the Monetary Authority of Singapore (MAS) and is permitted to act as a market operator (RMO). He announced what he had learned.
As a result, it has become possible to officially provide both a primary market (issuance and distribution) and a secondary market (distribution and trading) for digital securities (security tokens: ST).
DigiFT has been granted the authority to issue financial products such as securities and beneficiary certificates of co-investment schemes on-chain in Singapore, and to supervise and operate transactions in these products.
Founded in 2021, DigiFT operates an exchange with an automated market making (AMM) mechanism, which uses smart contracts to automate market making. The company joined MAS’s fintech regulatory sandbox in June 2022, promoting the issuance of digital securities and operating a secondary market management market.
connection: What is AMM (Automated Market Maker)? Explaining the mechanism and risks
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, equities, and co-investment schemes.
Investors can buy, trade, and redeem on-chain assets for fiat currencies and stablecoins through DigiFT’s website and mobile app.
CEO Henry Zhang said, “Obtaining the CMS license and RMO recognition are important steps toward enabling regulated access to financial opportunities on-chain.”
DigiFT is integrating RWA tokenization to bridge the gap between traditional finance and blockchain technology. In the future, the company plans to expand the regional rollout of its mobile app and provide features such as on-chain asset disclosure evidence and cross-chain deployment to improve the user experience for investors. 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. As DigiFT, he said, starting with the license in this prestigious financial hub, he will “focus on building the next generation of capital markets.”
connection: Introduction to digital securities: A guidebook for seizing the new wave of investment
What are real world assets?
Real-world 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 these using a common standard, it is expected to improve access for market participants, improve compatibility between markets, improve the liquidity of each asset, and lower the cost of financial transactions.
In particular, a precedent example of RWA tokenization is the “U.S. Treasury tokenization” market. As U.S. Treasury rates rise in 2023, the total value (TVL) deposited in this market protocol has grown from about $100 million at the beginning of the year to $785 million (about $110 billion) as of December 5. yen). Tokenized U.S. Treasuries have the same characteristics as regular U.S. Treasuries, such as an average interest rate of over 5% and return of principal at maturity.
connection: Why investors are interested in real asset tokenization and what is Real World Assets (RWA)?
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