Securitize and BNY Mellon Introduce Tokenized Fund Backed by AAA-Rated Credit

Securitize partners with BNY Mellon launch tokenized fund backed by AAA-rated credit - 1

Securitize has teamed up with BNY Mellon to launch a tokenized fund that offers blockchain-based exposure to AAA-rated collateralized loan obligations. This partnership aims to enhance accessibility and transparency in high-quality credit instruments while establishing a significant milestone in the tokenization of real-world financial products.

Key Takeaways

Securitize and BNY Mellon have partnered to launch a tokenized fund focused on AAA-rated collateralized loan obligations (CLOs).
BNY Mellon will serve as the custodian for the fund’s assets, ensuring a high level of security.
The fund will have an initial investment of $100 million, pending approval within the Sky Ecosystem.
This initiative is part of a growing trend of tokenizing traditional financial instruments to make them more accessible to investors.

Main Content

Securitize, a prominent platform for the tokenization of real-world assets (RWA), has announced that it is collaborating with BNY Mellon to launch a tokenized fund that provides onchain exposure to AAA-rated collateralized loan obligations (CLOs). This new initiative represents a key milestone in the effort to modernize access to high-quality floating-rate credit instruments using blockchain technology.

As part of this collaboration, BNY Mellon will take on the role of custodian for the assets underlying the fund, thereby ensuring that they are managed with institutional-grade security. Additionally, one of BNY Mellon’s subsidiary companies will oversee portfolio management functions. Pending approval from the Sky Ecosystem, Grove—a blockchain-based protocol focused on institutional credit—plans to support the fund with an initial allocation of $100 million.

Carlos Domingo, the CEO of Securitize, emphasized the significance of this initiative, stating that it facilitates a more accessible and transparent avenue for investing in high-quality credit instruments through innovative blockchain solutions.

This new tokenized fund launch follows Securitize’s recent announcement regarding its plans to go public via a merger with Cantor Equity Partners II, Inc., a special purpose acquisition company.

The introduction of this fund highlights the accelerating trend of tokenizing various real-world financial products. Earlier this year, Ondo Finance launched a tokenized U.S. Treasury fund on the XRP Ledger, enabling investors to hold and redeem exposure to government bonds through stablecoins. Around the same time, Centrifuge made waves by partnering with S&P Dow Jones Indices to tokenize the S&P 500 Index, marking a groundbreaking move as the benchmark was brought onto the blockchain.