Fidelity International Joins JPMorgan (TCN) Tokenization Network, Here's Why!

Fidelity International joins the JPMorgan (TCN) tokenization network (Photo; Doc. President)

JAKARTA - Fidelity International, a financial institution whose name has long been known worldwide, is now officially part of the JPMorgan Tokenization Network, or the Tokenized Collateral Network (TCN). TCN, which was built on the Onyx Digital Assets' personal blockchain network JPMorgan based on Ethereum is an initiative that marks the close involvement of traditional financial institutions with blockchain technology.

Fidelity International, which operates independently of similar companies in the United States, has taken progressive steps by tokenizing shares of its money market funds through TCN. This move allows Fidelity to use stock money market as collateral without the need to convert it into cash first. In an uncertain market situation, this step is expected to increase efficiency and stability.

Quoted from Blockworks, JPMorgan said, This move allows us to post MMF shares as collateral directly, without the need to redeem them into cash, which offers greater prospects for efficiency and stability at a time of market stress.

TCN, which begins its journey with tokenization of cash markets, plans to expand its scope to equity, fixed income, and various other asset classes. The ability to tokenize assets and use them in the title transfer structure and promises, which can operate beyond traditional market hours, has the potential to create new opportunities in the collateral market.

The first tokenization transaction at TCN occurred in October last year, with trading services JPMorgan working with Onyx Digital Assets to develop the network.

Keerthi Moudgal, head of product Onyx Digital Assets, enthusiastically welcomed Fidelity's participation in TCN, saying that this brought their MMF units to the network via tokenization. "The presence of Fidelity at TCN adds new assets that were previously difficult to use in today's collateral landscape," Moudgal said.

Stephen Whyman, head of the debt capital market at Fidelity International, stressed the importance of this move. "The stock tokenization of our money market funds to be used as collateral is an important and natural step in the evolution of this technology. The benefits for our clients and broader financial systems are very significant, especially in terms of efficiency in meeting margin requirements and reducing transaction costs as well as operational risks," Whyman said.