The paper claims that asset managers have successfully launched a direct fiat-to-digital onramp for consumers and created a digital asset fund with its own soulbound token. The fund might then be subscribed to by institutional investors via the direct minting of tokens, a decentralized exchange aggregator, or an integrated marketplace.
Initial steps included the development of an Ethereum-based DeFi platform by Deutsche Bank and Memento Blockchain, as well as a single, non-transferable” soulbound and token” (SBT). When the SBT has been used to confirm the owner’s identity, the creator of the platform may then provide them access to investment options without repeatedly requesting sensitive information.
Know Your Customer (KYC) checks and documents are stored off-chain and protected by a trust anchor. If a user’s risk tolerance or level of experience does not line up with a particular service or product, the SBT may be used to limit their access to that service or product.
Institutional investors holding SBT would give collateral in exchange for tokenized shares of the underlying digital investment fund of their choosing in exchange for making an investment. If the stock is tokenized, the tokens may be traded for other digital assets, such stablecoins, on an internal digital exchange. Asset managers, meanwhile, may use a unified interface for many methods, like DeFi staking, to establish tokenized funds on Ethereum testnets.
German financial institution Deutsche Bank and blockchain startup Memento Blockchain used the MetaMask platform to ensure the safety of client assets in their Project DAMA. With the integration of MetaMask, the partners’ primary digital wallet, the platform makes it easy to send and receive digital assets.
To use the platform’s distributed apps, institutional investors would need to have both an SBT in their MetaMask wallet and KYC. Deustche Bank has said that it is looking at implementing Project DAMA in Singapore, where there are now 1,100 registered fund managers handling a total of $3.36 trillion in assets.
Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.