financemagnates.com
The Singaporean branch of Deutsche Bank has announced the successful finish of Project DAMA's (Digital Assets Management Access) proof-of-concept phase. DAMA was designed in cooperation with Memento Blockchain and studied the possibilities of investing in tokenised securities via digital funds.
Deutsche Bank's DAMA to Change Fund Management Industry
Memento Blockchain and Deutsche Bank have initially created a decentralized finance (DeFi) platform based on the Ethereum (ETH) blockchain and a non-transferable soulbound token (SBT). Using their proprietary token, developers verified the identity of wallet holders and assigned them access to investment services without the need of additional background checks.
Meanwhile, a trust anchor is responsible for controlling the identity of users and storing off-chain records. SBT can also restrict access to products and services that do not match a potential investor's experience or risk tolerance level.
"The POC Project DAMA aims to test and demonstrate the technical and commercial feasibility of some of these key innovative features, which can, in turn, lower the barrier of entry for asset managers looking to launch a digital fund. The infrastructure is designed to be a one-stop investment servicing platform that combines and adapts the core components of transfer agency, fund administration, custody and payments for the digital fund environment," Federico Cristina, the Director and Co-Founder of Memento Blockchain, commented.
Institutional investors who want to invest in a fund must not only hold SBT, but must at the same time provide collateral to mint and receive tokenised shares in the digital fund of their choice. The tokenised shares are exchangeable on a digital asset market created explicitly for this purpose.
Project DAMA used MetaMask for asset security. The service has been built into the platform in the form of a digital wallet, which the project's partners chose to facilitate the transfer of cryptocurrencies easier.
Deutsche Bank is currently exploring the broader use of DAMA in Singapore, where there are currently more than 1,100 registered fund managers, managing nearly $3.4 trillion in assets.
Watch the recent FMLS22 panel titled: "Hodling on? Reimagining Crypto Market Structure."
Assets Tokenization Gains Popularity
The topic of tokenising the assets of traditional markets and moving them to a decentralized blockchain ecosystem is gaining popularity worldwide. Although the first platforms of this kind are already thriving, their full potential and possibilities remain untapped.
Tokenisation allows not only to turn companies' shares into digital tokens, but also to transfer parts of the real world into the digital world. Art, real estate, physical commodities and even intellectual property can be tokenised. Such solutions' advantages are access to greater liquidity, higher transparency, reduced costs and a much broader base of potential investors.
Finance Magnates recently spoke with Asif Kamal, CEO of Artfi. Artfi was launched in 2022 to democratize and fractionize the $1.7 trillion fine art and collectibles market. Artfi allows investors to own a stake in some of the world's most sought-after works of art.
"The theme of the next decade will be the tokenisation of physical assets. We feel that we are positioning Artfi as a leader in this domain, particularly when it comes to the tokenisation of fine art. Crypto and NFTs have taken a hit over the past 12 months due to a complicated macro environment mired by high inflation and monetary tightening," Kamal commented.