🏛️ Banks Can Now Custody Crypto

Another week, another dose of tokenized assets! Ray Buckton, Head of Research, here with the latest. 📸

What a wild week – SAB121, which disallowed US banks from custodying crypto, is out! Say hello to SAB122, which solely aims to undo its predecessor. 👏

This move means that banks in the United States can now custody crypto. We expect some big inflows in short order. 💸

🎯🔥 Rapid Fire Takeaways:

🔍 Why Tokenized Assets Are Key Beneficiaries of Recent SEC Changes

💰 Czech central bank head wants it to buy billions of euros in bitcoin

📊 RWA Tokenization Could Expand Private Investment Opportunities, Says Robinhood CEO

😬 DAI, Sky stablecoins are controversial under MiCA regulations. Implications for Tether?

💱 Circle-Hashnote deal looks to ease movement between cash, yield

👍 Bitpanda, OKX, Crypto.com Secure MiCA Licenses as Exchanges Eye 450M-Strong Market

🙈 BIS: Privacy-enhancing technologies for digital payments: mapping the landscape

And it gets better. Trump signed an executive order to explore a strategic Bitcoin reserve, and the industry-beloved Hester Pierce was tapped to head up a crypto task force. 🤯

Add in Musk exploring blockchain for his D.O.G.E. project and Larry Fink pushing for SEC approval of tokenized stocks and bonds, and it’s truly looking like the dawn of a golden age for crypto in the United States. 🦅

🏛️ TradFi Getting Serious

These big moves are seeing traditional financial players getting more serious about asset tokenization than ever before. After all, they’ll likely be the biggest beneficiaries of the recent SEC overhaul. Even Morgan Stanley’s CEO is discussing offering crypto, something that they’ve thus far shied away from. 💥 

It’s not just folks who are stateside that are feeling bullish. The head of the Czech central banks wants his nation to buy up to $9 billion worth of Bitcoin, just in case. If they diversify from there, they have a good template and can learn from others. BlackRock’s BUIDL offers insights into the key design options for tokenized money market funds, and Euroclear, EIB, and HSBC recently got together to discuss tokenization progress. 💬

🔮 Innovation and Projections

Speaking of learning from doing, Propy is exploring crypto loans to buy tokenized real estate, proving the recent statement by Robinhood’s CEO that tokenization will expand private investment opportunities. In fact, it might expand it to the point of making DNA Deal Desk’s recent prediction of $2-4 trillion in value creation from asset tokenization a reality. 📈

That value creation is happening one deal at a time, like 129Knots recent $10 million raise – we’re sure their $500 million deal pipeline helped with that. Plus, if RWA doubles in 2025 like some call for, we’ll have Larry Fink to thank and a strong start towards those trillions in value. ♟️

RWA is getting really interesting and diverse. Aethir is now working with Plume on tokenized AI and GPU. Even intellectual property could be considered an RWA. Just ask Story and Str8fire, who are working together on tokenized IP. 🧠

👀 All Eyes On Europe?

Tokenization may be global, but it still has to respect borders. Europe’s MiCA legislation is starting to significantly impact the industry, with big exchanges Bitpanda, OKX, and Crypto.com now officially in compliance. Similarly, Eurex Clearing scored BaFin approval for DLT-based margin collateral, so licenses for everyone. 🗃️

And while KfW issued another €9 billion in digital bonds using Clearstream’s D7, opinions on how MiCA will impact stablecoins continued to unfold. The ECB is pitching a digital euro in response to Trump, while Sygnum selected SocGen’s EURO stablecoin as its coin of choice. 🧰

Most interesting, however, is the revelation that the algorithmic DAI stablecoin, issued by Sky (formerly MakerDAO), is controversial under MiCA. The issue is whether Sky is decentralized enough to qualify for exemptions under the framework. Given the highly nuanced discussion and consideration determining that entails, we imagine there are already bright legal minds arguing in both directions. 📚

🤠 Tokenization In The Wild

New information on Circle’s recent Hashnote purchase. The acquisition aims to ease movement between money and yield, something Hashnote proved to be rather skilled at. And speaking of money moving, Ondo Finance is coming to XRP Ledger, while $150 million worth of money market funds just hit Arbitrum. ⛓️

Fasanara Capital also launched its first tokenized fund this week, and Texture Capital is working with Canton Network on its alternative trading system. Even the world’s most beloved metal is getting on board, as the London Bullion Market Association (LBMA) launched the Gold Bar Integrity (GBI) registry to digitize data collection and processing. 🥇

We’re also seeing classic names throw their weight behind tokenization. Fujitsu launched an open platform for Japanese logistics to streamline shipping in Japan. And while we’d imagine you need a physical address to tokenize shipping, the BIS released an awesome paper on how privacy might work in the future of digital payments. 🤫

☀️ Sunny Days Ahead

It may be winter in the northern hemisphere, but the sun shines bright for asset tokenization.

Big things are in the works, and we’re stoked to be at the forefront.

Here’s to a fantastic weekend and another great week just around the corner.