Deutsche Bundesbank joins Singapore’s Project Guardian to boost asset tokenization

Germany’s Deutsche Bundesbank has joined Project Guardian, a joint initiative of the Monetary Authority of Singapore, to advance asset tokenization.

Germany’s central bank, Deutsche Bundesbank, has joined Singapore’s Project Guardian, an initiative between policymakers and the financial industry to develop financial markets through asset tokenization.

The German central bank said in a Nov. 8 press release that it plans to deepen cross-border cooperation as well as advance discussions on “standardization and interoperability of digital assets.”

Under the cooperation agreement, Deutsche Bundesbank will test an interoperable blockchain platform for tokenized and digital funds, but details have not yet been disclosed. Leong Sing Chiong, deputy governor of the Monetary Authority of Singapore, expressed his belief that the Bundesbank’s expertise “will be invaluable as we work together to improve the liquidity and efficiency of financial markets through asset tokenization.”

Deutsche Bundesbank board member Burkhard Balz said MAS is working intensively on innovative issues that Germany is also addressing in Europe, such as pilots with distributed ledgers or blockchain networks. The German central bank wants to leverage the initiative’s resources to figure out how asset tokenization “can be used in a meaningful way in the financial sector,” according to Balz.

In early November, Singapore announced its intention to promote the commercialization of tokenized assets by improving market infrastructures, deepening liquidity, and creating industry frameworks to support cross-border transactions. According to Chiong, the country has “seen strong interest in asset tokenization in recent years, especially in fixed income, foreign exchange and asset management.”