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The Future Arrived on June 10
Friends, the future arrived this week. On Monday, June 10, to be precise.
I know that sounds crazy. But hear me out…
I’ve been predicting the tokenization of real-world assets (RWAs) since I recommended Ethereum back in 2016.
(You can hear me talk about the tokenization trend in this May 2017 3-minute YouTube video. Not to boast, but I was light years ahead of the mainstream media on this trend.)
That means anyone will be able to trade the rights to assets they own to anyone else anywhere in the world at any time – all with the click of a mouse.
I’m talking about stocks, bonds, real estate, precious metals, collectibles. Virtually any asset you can think of will be tokenized and traded on the blockchain.
When I first recommended Ethereum in 2016, the technology was still in its infancy. Since then, we’ve seen incredible innovations.
And as I predicted in my YouTube video, Ethereum is now ready for prime time.
On Monday (June 10), two of the world’s largest financial firms – Fidelity International and JPMorgan Chase – announced they had tokenized a money market fund and settled it over the blockchain.
Onyx Digital Assets is JPMorgan’s private network built on Ethereum, the world’s largest blockchain for tokenized assets.
Money market funds are mutual funds that invest in short-term debt securities. They offer low risk and income but little capital appreciation. According to the Federal Reserve, these funds hold $6.4 trillion in assets.
Blockchains improve efficiencies, lower transaction costs and reduce risks. So it’s no wonder in an interview with the website CoinDesk, Stephen Whyman, Fidelity International's head of debt capital markets, called the transaction a success.
Tokenizing our money market fund shares to use as collateral is an important and natural first step in scaling our adoption of this technology. The benefits to our clients and the wider financial system are clear; in particular, the improved efficiency in delivering margin requirements and reduction in transaction costs and operational risk.
This isn’t JPMorgan’s first blockchain-based collateral settlement. Last year, it settled a transaction involving tokenized shares in a BlackRock money-market fund.
The reason I’m so bullish about this particular transaction with Fidelity International is that it proves the technology is coming of age. We’re no longer in the testing phase.
Ethereum is now having its Netscape Moment.
Ethereum’s Netscape Moment