BBVA is launching a tokenized fund integrated into the sandbox of the Spanish securities regulator. The fund is only open to BBVA employees to explore the benefits of applying blockchain technology to these applications.
BBVA will experiment with the first Blockchain Tokenized Fund
Tradfi institutions are now open to testing decentralized technologies and applying them to existing use cases to explore their potential benefits. Banco Bilbao Vizcaya Argentaria (BBVA), the second largest Spanish bank, has announced that it will launch a tokenized fund as part of the regulatory sandbox established by the CNMV, Spain’s securities regulator.
In this sandbox, participants can innovate and try out new technologies, supported by supervisory supervision. Each project must be presented and meet the evaluations and requirements established by the CNMV.
The BBVA Token Short-Term Fixed Income fund will register its activities on a private blockchain provided by Allfunds, a software developer that produces decentralized solutions for third parties. BBVA Asset Management will act as fund manager and marketer, using Allfund’s network, smart contracts and nodes created exclusively for this test case.
Nevertheless, the fund will be managed by investors as if it were a traditional fund, which will avoid the complexity of its decentralized operation. This means that anyone with experience in managing these financial instruments can also manage this fund.
The bank reported that due to its experimental nature, only bank employees would participate in this fund, allowing the institution to evaluate the performance of this blockchain-based instrument without risks to regular customers. BBVA emphasized that this was the result of a joint effort between the Asset Management department and other teams in the BBVA Group, including those dealing with digital assets and blockchain technology.
Underlining the relevance of this step for the institution, Belen Blanco, CEO of BBVA Asset Management Europe, stated:
The project marks an important step towards adopting a technology with broad transformative potential in asset management, starting in a controlled and regulated environment where BBVA AM can explore its benefits in a secure and scalable manner.
The bank recently reported that it will launch a European-linked stablecoin next year in partnership with Visa.
Read more: BBVA to Launch Visa-Backed Euro-Pegged Stablecoin Next Year