UBS Rolls Out Tokenized Fund on the Ethereum Blockchain Network

The Union Bank of Switzerland (UBS) has rolled out a tokenized fund on the Ethereum blockchain network after highlighting the increasing interest

Union Bank of Switzerland (UBS) has launched a tokenized money market fund on the Ethereum network, highlighting the increasing demand among investors for tokenized financial assets.

In a Nov. 1 statement, the banking giant announced the launch of the money market fund built on the Ethereum network, known as the “UBS USD Money Market Investment Fund Token” or “uMINT.”

"We have seen a growing investor appetite for tokenized financial assets across asset classes," said Thomas Kaegi, co-head of UBS APAC.

Crypto commentators are bullish on the move and expect it to have a positive impact on Ether ( ETH) price, which currently stands at $2,504.16.

"This move is like putting ETH right into the heart of traditional finance," wrote popular crypto show Mario Nawfal's Roundtable in a Nov. 1 X post.

"If big banks are ready to play, it’s only a matter of time before tokenized assets go mainstream," Mario Nawfal's Roundtable added.

Meanwhile, crypto analyst Tony Edward commented on the news, saying, "If you don’t have some exposure to ETH, you’re going to miss out on gains." At the time of publication, Ether is trading at $2,515, according to CoinMarketCap data.

According to UBS, token holders will be able to leverage the bank's “institutional-grade cash management solutions,” which rely on high-quality money market instruments and are structured around a “conservative, risk-managed framework.”

The launch comes a year after the bank first tested a controlled pilot of the tokenized money market fund.

In October 2023, UBS conducted the pilot through its in-house tokenization service called UBS Tokenize. Using a smart contract on Ethereum, the firm carried out various activities, including redemptions and fund subscriptions.

Financial institutions flock to blockchain networks

Several financial institutions have recently launched tokenized money funds on blockchain networks.

On Oct. 31, Cointelegraph reported that Franklin Templeton was launching its tokenized money fund on Base, Coinbase's layer-2 network.

The Franklin OnChain US Government Money Fund (FOBXX) was the first tokenized fund to launch on Base.

Created in 2021, FOBXX has previously launched on blockchain networks, including Stellar, Polygon and Arbitrum.

ParaFi Capital to tokenize $1.2B fund on Securitize

Just a day before, on Oct. 30, Libeara, a blockchain asset tokenization platform, and FundBridge Capital, a fund management infrastructure, launched a tokenized United States Treasuries fund on a public blockchain for investors.

On May 1, BlackRock's USD Institutional Digital Liquidity Fund became the largest treasury fund tokenized on a blockchain after surpassing Franklin Templeton's product.