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BNP Paribas Asset Management has issued a class of tokenized shares of a money market fund domiciled in France, registered on the public blockchain infrastructure.
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The initiative is based on a permissioned access model on Ethereum, limiting holding and transfers to authorized participants within a regulated framework.
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Carried out in the form of an intra-group experiment, the project draws on the joint expertise of BNP Paribas Asset Management, CIB AssetFoundryTM and the Securities Services business of BNP Paribas to test new end-to-end fund processes.
BNP Paribas Asset Management has issued a tokenized share class of an existing money market fund domiciled in France, marking a new step in its exploration of fund tokenization using public blockchain infrastructure.
The project provided for the issuance of a class of tokenized shares of the BNP Paribas Asset Management monetary fund on the public Ethereum network via BNP Paribas AssetFoundry.TM platform. Tokenized shares are issued under a permissioned access model, where holdings and transfers are limited to eligible and authorized participants, in accordance with applicable regulatory requirements.
This initiative follows the previous issuance of tokenized money market funds from BNP Paribas Asset Management in Luxembourg on a private blockchain. This second tokenized money market fund project was implemented using a different technological and operational setup via a public blockchain. Together, these initiatives reflect BNP Paribas’ approach to exploring multiple tokenization and distribution models to better serve fund managers and their investors.
Leveraging BNP Paribas’ cutting-edge capabilities through the Group’s integrated model
As part of this project, BNP Paribas Asset Management acted as issuer of the fund. BNP Paribas’ Securities Services business acted as transfer agent and fund trading service provider, while BNP Paribas CIB’s AssetFoundry businessTM The platform provided the tokenization and connectivity layer to the public blockchain network.
Furthermore, BNP Paribas’ Securities Services business operated the wallet configuration and held the private key as part of this controlled intra-group pilot.
The initiative was conducted as a one-off, limited intra-group experiment, allowing BNP Paribas to test new end-to-end processes, from issuing and transfer agency to tokenization and public blockchain connectivity, within a controlled and regulated framework.
Public blockchain with permissioned access
The tokenized fund shares were issued on the public Ethereum network with permissioned tokens ensuring that only eligible participants can hold and transfer the tokens, while benefiting from the strength and widespread adoption of public blockchain infrastructure.
This approach allows BNP Paribas and BNP Paribas Asset Management to evaluate how public blockchains can be integrated into regulated fund structures, while maintaining the highest standards of governance, investor protection and operational robustness.
Tokenization is an innovative technology that is being explored in the financial sector for its potential to improve the way investment funds are issued and distributed over time. For money market funds in particular, which play a central role in liquidity management for corporate and institutional investors, tokenization could be used as an alternative to traditional batch fund processing, including smoother and more flexible processing of fund-related transactions, while preserving the regulated nature of these funds.
“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, Digital and Data Director of BNP Paribas Asset Management
“BNP Paribas” Asset FoundryTM The platform offers key digital asset capabilities, from tokenization to network connectivity and wallet-related features in 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 AssetFoundryTM (Digital Assets & Tokenization) at BNP Paribas CIB
“BNP Paribas’ Securities Services business transforms innovation into tangible value for our clients. By acting as a transfer agent and leveraging the Group’s tokenization infrastructure, we provide a streamlined and secure operational setup that supports funds processes enabled by public blockchain infrastructure, in a regulated and permissioned context..” Paul Daly, head of distribution product solutions within the Securities Services activity of BNP Paribas
