Switzerland’s UBS, emphasizing the increasing interest of investors in tokenized financial assets, has launched its first tokenized fund based on Ethereum. Cryptocurrency analysts state that this move is equivalent to placing ETH at the core of traditional finance, expecting a positive impact on the price of ETH.
Traditional Finance (TradFi) is actively venturing into tokenization and RWAs. UBS Group, Switzerland’s largest bank and global wealth management giant, announced yesterday (1st) that it is launching its first tokenized fund on the Ethereum blockchain, named “UBS USD Money Market Investment Fund Token,” abbreviated as “uMINT.”
In a press release, UBS Asia Pacific Co-Head Thomas Kaegi stated that the company has “observed growing interest from investors in tokenized financial assets across asset classes.”
While UBS did not disclose the specific financial instruments that make up the tokenized fund, it mentioned that uMINT token holders will be able to utilize its institutional-grade cash management solution, based on “high-quality money market instruments,” and built around a “conservative risk management framework.”
The launch of this fund is part of UBS’s broader effort to expand tokenization services through UBS Tokenize. As a partner of the Monetary Authority of Singapore’s Project Guardian, UBS Asset Management initiated a pilot of the Variable Capital Company (VCC) fund on Ethereum in October last year, utilizing smart contracts for various activities including redemption and fund subscriptions.
Several cryptocurrency commentators view this move positively for Ethereum and anticipate further boosting of the ETH price. Cointelegraph reported that in a roundtable conference hosted by popular cryptocurrency show Mario Nawfal, it was praised as “placing ETH at the core of traditional finance.” Additionally, it was stated, “If major banks are ready to participate, tokenized assets becoming mainstream is only a matter of time.”
At the same time, cryptocurrency analyst Tony Edward commented that “If you haven’t touched ETH yet, you are missing out on gains.” As of the deadline, the ETH trading price is $2,505, up 0.1% in the last 24 hours, hovering around $2,500.
It is worth noting that after BlackRock, the asset management giant, issued the first tokenized fund on Ethereum in March this year called “BlackRock Institutional Digital Liquidity Fund” (BUIDL), several financial institutions have been launching tokenized currency funds on blockchain networks. Recently, Franklin Templeton launched its US Government Money Fund (FOBXX) on the Base chain, which was previously released on chains like Stellar, Polygon, and Arbitrum.
Data from RWA.xyz shows that Ethereum is currently the largest RWA tokenized blockchain, with tokenized asset value exceeding $3 billion on the network. Assets worth around $13 billion are tokenized on the chain, with private credit accounting for the highest proportion, over $9.2 billion, followed by US government bonds at around $2.4 billion. BlackRock’s $BUIDL holds the highest value of US government bonds, exceeding $523 million.