Citi teamed up with institutional partners to explore tokenization on the Avalanche Spruce testnet.<\/p>\n
Citi, a \u201cBig Four\u201d bank boasting $759B in assets under management worldwide, is deepening its exploration of asset tokenization.<\/p>\n
On Feb.14, Avalanche\u00a0announced<\/a>\u00a0that Citi completed a pilot on one of its subnet testnets to explore permissioned tokenization trials with a focus on private markets. The trials were executed in partnership with select investment and wealth management clients including WisdomTree, Wellington Management, and ABN AMRO Bank.<\/p>\n \u201cThe bank tested use cases on Avalanche \u2018Spruce\u2019, an Evergreen testnet Subnet designed for buy-and-sell-side institutions,\u201d Avalanche said in a blog post. \u201cCiti\u2026 leveraged the Avalanche network to test how the combination of blockchain infrastructure, tokenization, and smart contract logic might help to re-architect capital markets and enhance financial services.”<\/p>\n The trials are the latest example of a major financial institution using distributed ledger technology to explore tokenization use cases. Migrating assets on-chain offers significant efficiency benefits, including reduced operational costs, increased transparency, and typically high levels of customization.<\/p>\n JPMorgan was among the first with the launch of Quorum, a permissioned fork of Ethereum, back in 2015, followed by its Onyx digital asset division and platform in 2020. Onyx has settled more than $900M worth of transactions and began working with Avalanche last year as part of a pilot with the\u00a0Monetary Authority of Singapore<\/a>\u00a0exploring tokenization.<\/p>\n Other major financial firms diving into tokenization include\u00a0HSBC<\/a>,\u00a0BNY Mellon<\/a>,\u00a0Santander<\/a>, and\u00a0Franklin Templeton<\/a>, among a plethora of others.<\/p>\n Citi said tokenization unlocks \u201cnew use-cases and digital distribution channels\u201d for traditional markets, while also enabling novel operating models, data collection, and user autonomy.<\/p>\n Citi\u2019s recent tokenization trials included end-to-end token transfers representing private equity, secondary tradinf, and collateralized lending via smart contracts leveraging the Depository Trust Clearing Corporation\u2019s\u00a0Digital Assets Composer<\/a>.<\/p>\n The pilots also featured the use of \u201cencoded compliance checks and identity credentials\u201d issued by WisdomTree to test regulatory compliance processes.<\/p>\n <\/p>\nMajor institutions explore tokenization<\/h2>\n
Avalanche Spruce<\/h2>\n