- BNP Paribas launches tokenized MMF shares using blockchain for transactions.
- Project builds on CBDC trials to boost digital asset innovation.
- BNP partners with Allfunds Blockchain to digitize financial product lifecycles.
In a recent move signaling a strong shift toward digital innovation, BNP Paribas Asset Management (BNPP AM), France’s largest bank, introduced a new initiative involving tokenized money market fund (MMF) shares. So far, the bank has tried out using DLT to run cross-border transactions, rather than just sticking to traditional systems.
BNPP AM Leverages CBDC Trials for Digital Asset Innovation
This pilot project is being carried out with support from other initiatives. BNPP AM has joined forces with Allfunds Blockchain to provide the technology. The Securities Services business of BNP Paribas is assisting by acting as the transfer agent and provider of fund dealing services. As a result, the bank issued a newly tokenized share class of an existing money market fund based in Luxembourg.
Additionally, the project will build upon the 2024 trials of Eurosystem wholesale CBDC. BNPP AM aims to study the ways security tokens could enhance the management of assets in this new segment. The tokens act as shares that enable speedy, transparent and quick access to information. The technique can help reduce the usual issues of batch-driven operator scheduling.
Because tokens represent shares, orders for these can be processed immediately once the NAV is available. This step would help shorten waiting time, so clients don’t have to spend so long at the bank.
Remarkably, tokenization may attract more participants apart from just institutional investors. Greater efficiency and easier access may give money market funds a chance to help more retail investors. It would make it easier for people to get quick access to and use their investment funds whenever they want.
In addition, using blockchain is meant to cut down the time needed for settling transactions. Creating instant settlement options is one part of the push to make banking and finance easier for people to use. The project ensures security is at the heart of every financial action.
BNP Paribas Sees Native Tokens as Future of Finance
Through this venture, BNP Paribas is signaling its dedication to embracing digital tools. Money Market Funds Deputy CIO, Thibault Malin, believes that adopting these technologies is essential for meeting client expectations and dealing with evolving financial demands.
Additionally, Paul Daly from BNP Paribas Securities Services was excited about this project. He pointed out that native tokens are better than traditional shares in digital form. These benefits are higher access to exchanges, quicker settlement of trades and improved linking of standard and digital assets.
Ruben Nieto, as Managing Director at Allfunds Blockchain, also agrees. He explained that native tokenization supports the move of all financial products to digital form. Therefore, investors should find that their orders are handled more promptly.
Ultimately, BNP Paribas is improving the way assets are controlled and helping create the digital future. This tokenized MMF project helps the bank stay ahead in using the latest technology in finance.
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