BNP Paribas Breaks New Ground with Tokenized Money Market Fund on Public Ethereum Blockchain

In a bold move towards the future of finance, BNP Paribas has launched a tokenized share class for one of its money market funds using a . This step shows how big banks are embracing blockchain technology to make investing faster and more efficient.

What is This Project All About?

BNP Paribas Asset Management created a new type of share for its French money market fund. These shares are now digital tokens on the public Ethereum network. They used their own platform called AssetFoundry™ to make this happen.

The tokens work under a permissioned system. This means only approved people can buy, hold, or sell them. It keeps everything safe and follows all the rules set by regulators.

This is not their first try. Before this, they did a similar project in Luxembourg using a private blockchain. Now, with the public Ethereum chain, they are testing different ways to use tokenization. The goal is to find the best methods to help fund managers and investors.

How BNP Paribas Made It Work: Team Effort Across the Group

BNP Paribas used its full strength as a big global bank. Here is how each part played a role:

• BNP Paribas Asset Management: Issued the fund shares.
• BNP Paribas Securities Services: Handled transfers and deals, plus set up wallets and kept private keys safe.
• BNP Paribas CIB’s AssetFoundry™: Connected everything to the Ethereum blockchain and managed tokenization.

This was a test run just within the BNP Paribas group. It let them try the whole process from start to finish in a safe, controlled space. They checked issuance, transfers, and blockchain links.

Why Use a with Permissioned Access?

Ethereum is the most popular public blockchain. It has strong security and many users. But for funds like this, they added controls so only eligible investors can join.

This mix gives the best of both worlds:

• Power and reach of public chains.
• Safety and rules for regulated funds.

Money market funds help companies and big investors manage cash. They need quick liquidity. Tokenization can replace old batch processing with real-time trades. This means more flexibility while staying regulated.

Key Quotes from BNP Paribas Leaders

“BNP Paribas Asset Management is committed to driving innovation that will ultimately benefit our clients. This second issuance of tokenized money market funds, this time using public blockchain infrastructure, supports our ongoing efforts to explore how tokenization can contribute to greater operational efficiency and security within a regulated framework.”

— Edouard Legrand, Chief Digital and Data Officer at BNP Paribas Asset Management

“BNP Paribas’ AssetFoundry™ platform delivers key digital-assets capabilities, from tokenization to network connectivity and wallet-related functionalities within a controlled setup. This initiative allows us to better understand the operational and governance implications of tokenization for money market funds.”

— Julien Clausse, Head of AssetFoundry™ (Digital Assets & Tokenization) at BNP Paribas CIB

“BNP Paribas’ Securities Services business transforms innovation into tangible value for our clients. By acting as transfer agent and leveraging the Group’s tokenization infrastructure, we deliver a streamlined and secure operational setup that supports fund processes enabled by public blockchain infrastructure, within a regulated and permissioned context.”

— Paul Daly, Head of Distribution Product Solutions at BNP Paribas’ Securities Services business

The Bigger Picture: Tokenization Wave in Finance

BNP Paribas is not alone. The finance world is buzzing with tokenization. For example:

• Franklin Templeton is growing its lineup of tokenized funds. This shows big demand from institutions for on-chain investments.
• BlackRock saw record inflows into ETFs, with active strategies gaining traction.
• Banks like Lloyds are using tokenized deposits for buying gilts.
• Even insurance firms like Delaware Life are adding crypto indexes to products.

Tokenization promises 24/7 trading, lower costs, and instant settlements. For money market funds, it could mean processing trades any time, not just in batches.

Benefits of on Blockchain

1. Faster Operations: Real-time transfers instead of daily batches.
2. Better Liquidity: Investors can move money quicker.
3. Lower Costs: Less paperwork and middlemen.
4. High Security: Blockchain’s tamper-proof records.
5. Global Reach: Easy access for approved users worldwide.

But challenges remain. Regulators want strong investor protection. Banks must balance openness with controls.

What Does This Mean for Investors and the Crypto World?

This project proves public blockchains can work for traditional finance. It bridges TradFi and DeFi. As more banks test this, we could see tokenized funds become normal.

For crypto fans, it’s a win. Ethereum gets more real-world use. This boosts trust in blockchain for big money.

Watch for more pilots. Soon, your bank account might link directly to tokenized assets.

Conclusion: A Step Towards Blockchain-Powered Finance

BNP Paribas’s use of for a money market fund is a game-changer. It shows how tokenization can modernize funds while keeping safety first. As leaders like Edouard Legrand say, this innovation benefits clients with efficiency and security.

Stay tuned for more updates on blockchain in finance. The future is digital, tokenized, and on-chain.