UBS launches its first tokenized fund on Ethereum blockchain

UBS Asset Management, a subsidiary of Zurich-headquartered investment bank UBS, has launched its inaugural tokenized fund on the Ethereum blockchain, aiming to expand access for its clients.

According to a Nov. 1 statement, the new product — the “UBS USD Money Market Investment Fund Token” or “uMINT” — offers clients an innovative investment solution.

Token holders will gain access to UBS Asset Management’s institutional-grade cash management strategy, which utilizes high-quality money market instruments under a conservative, risk-managed framework.

Thomas Kaegi, Co-Head of UBS Asset Management, emphasized that the launch aligns with increasing investor interest in tokenized assets. He commented:

“We have seen growing investor appetite for tokenized financial assets across asset classes. Through leveraging our global capabilities and collaborating with peers and regulators, we can now provide clients with an innovative solution.”

This launch also supports UBS’s broader “UBS Tokenize” initiative, which began in June 2023 by creating fully digitally structured notes worth CNH 200 million for a third-party issuer. By November, UBS had executed the first-ever cross-border repurchase transaction using a natively issued digital bond on a public blockchain.

UBS Asset Management said these efforts reflect its ongoing commitment to both public and private blockchain networks, enabling it to expand offerings like fund issuance and distribution, creating more streamlined and accessible financial products.

As of the fourth quarter of 2023, UBS managed $5.7 trillion of its clients’ invested assets. The company operates in more than 50 markets worldwide.

Rapid growth

Tokenization, representing traditional assets such as the US Treasury-backed money market funds on blockchain networks, has gained significant traction among established finance firms, including BlackRock, over the past year.

Notably, the US Treasury Department has acknowledged tokenization’s potential to reshape markets, noting that it could boost efficiency, broaden investor access, and increase transparency in the Treasury market.