IN THIS ISSUE
Cytus launches
JPMorgan, DBS and SBI Digital Asset execute live trade using DeFi, tokenized deposits and verifiable credentials
New listings on RealWeb3db.com
Worth Your Time
Cytus Launches
Cytus, a DeFi trading protocol created by RobinLand, launched with two products: a US Treasury pool and a tokenized loan for a group of condominiums in New York.
JPMorgan Executes Live Trade on Public Blockchain
This is a Big F-ing Deal. Yes, it’s in Singapore, but it’s a real transaction backed by one of the world’s largest banks, and the tokens are represented on their balance sheet just like any other deposit.
“[SGD] is a deposit token which is a general liability of JPM,” Ty Lobban, head of Onyx Digital Assets, tweeted, adding that the native token gives “stable on-chain value without the scalability issues of stablecoins.”
In the second trial, DBS and SBI Digital Assets traded against liquidity pools of tokenized government bonds with DBS tokenizing SGD currency and Singapore Government Securities bonds. SBI did the same for Japanese bonds and JPY currency.
Why is this significant? Because it bridges blockchain to the real world, but it does so on blockchain’s terms — immutable, transparent, public — and represents a key step forward in bringing trillions in assets on chain. That won’t happen overnight, of course, but it’s a lot easier to copy and improve on an existing framework than to create on in the first place. Expect a lot of innovation in this space over the next 12-24 months.
Ironically, JP Morgan Chase CEO Jamie Dimon called DeFi “decentralized Ponzi schemes” just in September in testimony before Congress. He contains multitudes.
Bonus trivia: JP Morgan invented the credit default swap, a type of derivative that helped destabilize the mortgage-backed securities market, leading to the 2008 financial crisis, which in turn led Satoshi to create Bitcoin. The circle of life!
Read the whole thing on on Blockworks.
New listings on RealWeb3db.com
Cytus Finance - “Cytus is bringing Treasury Bills on-chain allowing crypto investors to access safe and stable yield in these harsh market conditions.”
This project led me to expand our mandate beyond real estate to include other assets like treasuries. The vast, vast, vast majority of securities are not in equities like Apple or Ford, rather debt like treasuries, bonds, commercial paper and real estate loans. A potential investor in those kinds of assets is not weighing their options against the S&P 500. That’s far too risky.
Instead they’re weighing the choice between lending money for, say, mortgages against just putting them in US Treasury bills. For most of the last 14 years the real rate of return on treasuries ( aka inflation-adjusted return) has been below zero. The Fed’s recent tightening is dramatically changing that. Putting bonds on chain has the potential to onboard tens of billions in liquidity backed by a real world asset
United States Property Coin (USPC) - Like a lot of these projects, USPC appears to be acting as a general partner that find properties and issues coins to investors. One thing that’s not clear to me is, where do the liquidity come from, and what happens if the property value declines? The white paper makes the dangerous assumption that real estate always appreciates. That’s the same dangerous assumption that crushed a lot of balance sheets in 2008.
Worth Your Time
Blockworks: What Are Real-world Assets? DeFi’s Newest Yield
Bankless: SBF vs Erik Vorhees on crypto regulation. I’m more on SBF’s side but Vorhees represents an important and large ideological faction within Crypto.