Sygnum Pioneers Treasury Tokenization with USD 50M Fidelity MMF Investment

Sygnum Bank breaks new ground by tokenizing USD 50 million of Matter Labs’ government reserves into the Fidelity Institutional Liquidity Fund, enhancing the synergy between traditional finance and crypto.

Sygnum, a prominent digital asset banking group, has announced the tokenization of $50 million of Matter Labs’ treasury reserves. This strategic initiative was facilitated by an investment in Fidelity International’s US$6.9 billion Institutional Liquidity Fund (ILF), marking significant progress in the integration of blockchain technology with conventional financial products.

Matter Labs, known for its pioneering work in scaling Ethereum through zk-rollup technology, took this step as part of its broader strategy to transfer its treasury reserves to the blockchain. On-chain representation of Fidelity’s ILF units via Sygnum-issued security tokens provides a secure and transparent “Proof of Reserves”, in line with Matter Labs’ commitment to institutional-grade transparency and security.

This project is the first of its kind to use Sygnum’s multi-chain tokenization solution, bringing together the capabilities of traditional securities with the distinctive advantages of blockchain. By tokenizing a portion of Fidelity’s money market fund investment, Sygnum not only strengthens the Crypto-TradFi connection, but also lays the foundation for a fully tokenized financial ecosystem.

Jürg Rimle, head of Switzerland at Fidelity International, shared his enthusiasm for the partnership with Sygnum Bank, highlighting the increased access it provides to professional and institutional investors and highlighting the strengthening bridge between the digital asset economies and traditional finance.

Fatmir Bekiri, Head of Tokenization at Sygnum, explained the potential of the collaboration, highlighting the combined strengths of blockchain technology and the expertise of a Tier 1 global investment manager. The collaboration illustrates Sygnum’s mission to unite the crypto space with traditional financial (Trad-Fi) sectors to create the future of on-chain finance.

Marco Cora, senior vice president of business and operations at Matter Labs, expressed the firm’s desire to work with Sygnum to demonstrate the institutional security of the zkSync blockchain. The move to tokenize US$50 million of their government reserves underscores Matter Labs’ commitment to using blockchain technology for increased investor trust and transparency.

The upward trend of tokenization of real-world assets (RWA), which saw a growth of 74% in 2023 to 2.5 billion USD, speaks of the growing interest and confidence in the tokenization of traditional assets. The benefits, such as improved liquidity, affordability and the creation of new financial products, catalyze the move to more efficient and transparent financial markets.

Sygnum, with a banking license in Switzerland and licenses in Singapore, Abu Dhabi and Luxembourg, is positioning itself as a leader in digital asset banking. The firm’s vision of “Finance of the Future” is rooted in Swiss and Singaporean heritage, bridging the gap between traditional and digital asset economies.

As the digital asset space continues to evolve, the tokenization of Matter Labs’ treasury reserves through Sygnum’s platform is a testament to the potential for innovative financial solutions that leverage blockchain technology. It is a step towards a future where digital and traditional financial services are no longer distinct, but rather seamlessly integrated.

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