DLT Update: August ’22
Latest industry news
Asset managers in the UK to offer fund tokens despite crypto turmoil
Despite the wild behaviour of crypto markets in recent months, asset managers are preparing to use blockchain technology to break funds into bite-sized units and sell them to small savers. Private markets investment firms Hamilton Lane (HLNE.O) and Partners Group have tokenized funds in the past year and said they were considering further products. Mainstream asset manager abrdn (ABDN.L.) hopes to launch a tokenized fund this year (2022), and rival Schroders (SDR.L) is also investing in the sector.
Lending platform Compound becomes multichain
The DeFi giant Compound is ready to launch its latest upgrade providing a multichain lending platform. Currently, the platform only runs on Ethereum blockchain and they want to extend to several blockchains harnessing the power of a multichain environment. Compound III lending will soon be making its way into the multichain environment as the biggest innovation. Compund’s biggest competitor in the lending sector, Aave, has already ventured into this area. With its third version, Aave V3, the protocol enables access to the platform via blockchains such as Avalanche, Harmony or Fantom.
These developments lay the foundation for a new DeFi interoperability.
The United States Federal Reserve Board provides additional information for banking organizations engaging or seeking to engage in crypto-assets-related activities
On August 16th, 2022 the Federal Reserve Board issued a letter outlining the steps supervised banks need to follow before engaging in crypto-assets-related activities. Among the steps are: assessing whether the activities are legally permissible, determining if regulatory filings are required, and notifying the Board prior to engaging in those activities. The supervisory letter also states that Board-supervised banking organizations should have adequate systems and controls in place to perform crypto-asset-related activities in a safe and sound manner prior to commencing such activities.
(Board of Governors of the Federal Reserve System)
Australian Securities Exchange Takes step towards tokenized asset trading
Companies on the Australian Securities Exchange (ASX) will be able to trade tokenized assets as bonds, shares, funds, or carbon credits after a successful proof-of-concept trial led by the digital asset investment platform Zerocap.
Saudi Arabia’s Central Bank hires Virtual Assets and Digital Currency Program Lead
Mohsen AI Zahrani has been selected by the Central Bank of Saudi Arabia to lead the Virtual Asset and Digital Currency Program, a surprising turnaround decision after the banning of cryptocurrencies four years ago. This demonstrates a change of stance, mostly driven by demand pressure and the impossibility of controlling its growth. Is the first step toward cryptocurrency regulation in the region.
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