Your First Captivating Topic of the Week

🇺🇸 CFTC Committee Recommendation on Tokenized Collateral

The Commodities Futures Trading Commission (CFTC) of the United States has 5 advisory committees, one of which is the Global Markets Advisory Committee (GMAC), sponsored by Commissioner Caroline D. Pham. They convened on November 21st and approved recommendations on expanding the use of non-cash collateral using distributed ledger technology. The vote resulted in no objections and marks the 14th recommendation GMAC has advanced to the Commission in the last 12 months. 

We’ve seen this already with Barclays, BlackRock, and JPMorgan just over a year ago using tokenized money market fund units for posting margin. Then again earlier this year with BUIDL being used for collateral on FalconX and Hidden Road. That said, regulatory clarity is still top of mind for many as they explore and build infrastructure to support tokenized collateral, which hopefully this advancement will help in.

The fact that the GMAC’s recommendations include no additional changes to regulation is a positive sign as it shows the CFTC’s understanding of blockchain technology being simply that, a technology. They acknowledge distributed ledger technology being used for internal books and records, rather than changing the nature of the asset itself and therefore institutions can rely on existing rules and guidelines. Full Meeting Video Linked Here.

This is not financial advice.

Have you joined the RWA Foundation yet? 

Incubated by Security Token Market, the Real World Assets (RWA) Foundation is a crypto native organization dedicated to bridging crypto natives and tokenized assets. The leading brands in the tokenization and RWA industry contribute support in order for the RWA Foundation to develop educational resources, media, events, grant programs, and crypto-focused initiatives to carry out its mission.

Follow on X, join the Telegram, and stay updated on all things about the Foundation, RWA Industry, our upcoming DAO launch, and a whole lot more. TRUNKS UP 🐘 !

Your Second Captivating Topic of the Week

🔒 Custody Updates: Zodia Partners with Securitize, tZERO Launches Custody via SPBD

Custody is a subject often overlooked yet very important in transacting assets. It’s what ensures the safety of those assets, including tokenized securities such as tokenized funds and liquidity products. Zodia Custody, which is backed by Standard Chartered and Northern Trust, is now partnered with Securitize for custody of tokenized assets like BlackRock’s BUIDL. For institutions to come on-chain they need to feel safe and secure doing so, which is where enterprise-grade solutions such as Zodia come into play. Others using the StanChart/NTRS-backed platform include 21Shares, Invesco, Bitwise, and more.

In other news, non-institutions also need custody solutions which is why many tokenization platforms partner with 3rd parties. What if the same platform could custody on behalf of their clients? tZERO is now offering that thanks to their newly-issued Special Purpose Broker Dealer (SPBD) license. Only one other firm in the space, Prometheum, has this license as well which they recently announced they’ll soon start applying to traditional securities.

In this past Friday’s interview with Alan Konevsky from tZERO, he expressed how this could help improve the user experience and liquidity rather than the former,  fragmented environment. He also shared that another unlock for them is having the full lifecycle of an asset live on-chain, meaning we’ll be seeing more blockchain-native RWAs rather than the digitally-enhanced counterparts (mirror assets) we’ve seen in the past.

The first token to take advantage of this is none other than their own $TZROP, which represents preferred equity in tZERO, with others in the pipeline and we expect this to be fully operational in Q1 2025.

This is not financial advice.

Companies of the Week

We hope everyone celebrating Thanksgiving had a great time with friends and family last week. The Security Token Show will be back this Friday with more exciting updates, but in the meantime enjoy this interview with tZERO’s EVP and Chief Legal & Corporate Affairs Officer, Alan Konevsky.

TokenizeThis 2025

Security Token Market’s annual industry conference will be back next year and moving from Miami to the heart of finance in the big apple. Featuring keynotes, speakers, panels, and demos, TokenizeThis aims to be the largest premiere event dedicated to real world assets exclusively.

This year’s edition of TokenizeThis featured incredible speakers like Carlos Domingo, CEO of Securitize, Ex-SEC Commissioner Troy Paredes, and Anthony Bassili, the head of tokenization at Coinbase, alongside many other speakers from the likes of JPM Onyx-turned-Kinexys, DTCC, Franklin Templeton, Northern Trust, RealT, Propy, Maple, Avalanche, Stellar, Solana, Polygon, and many others. Tickets and the speaker line up will be announced later this year so be sure that you’re signed up for the waitlist on summit.stm.co.

Reports

(NEW) RWA Securities Market Update: October 2024

We're excited to release the October 2024 edition of our RWA Securities Market Update report, which features benchmarks against the CoinDesk 20 Index (CD20)! In this month’s market report, we have meticulously tracked 680 security tokens spanning across 35 marketplaces and 10 blockchains.

Sections include:

• Key Takeaways

• Quantitative Highlights

• Asset Class Breakdown

• On-Chain Liquidity Products

• Platform Spotlight: Hashnote

• New Tokens and Announcements

State of the Tokenization Industry 2024 Report

We are very excited to publish our State of the Tokenization Industry 2024 report tomorrow with our sponsor SteelWave Digital! The Security Token Market team covers this year’s headlines and key takeaways, sorted into the following categories:

Search away, share it with a colleague, and revisit the same link for future updates!

TokenizeThis 2024: Highlights and Key Takeaways Report

The TokenizeThis 2024 Conference Highlights Report is Now Available! This was the industry’s event of the year with 500+ registered attendees, 40+ speakers, and 20 sessions & side events in Miami, FL!

There was so much to do you may have missed some panels but not to worry, the STM Team has put together a summary of it all just for you.

This is not financial or investment advice.