The UK-based asset management firm Aviva Investors has launched its first-ever tokenized money market fund (MMF) share class, partnering with Ripple to run the US dollar (USD) Liquidity Fund on the XRP Ledger. The Central Bank of Ireland approved the Undertakings for Collective Investment in Transferable Securities (UCITS) fund in the existing money market. The other share class funds under the asset management stand at $1.23 billion.
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XRP Ledger: Aviva Investors Enters the Tokenized Sector For Funds
Reports suggest that Aviva Investors will first deploy $1.34 million into the tokenized XRP Ledger. Aviva Investors described the partnership with Ripple as “a scalable foundation for future innovation in fund distribution and market infrastructure.” This is a new feather in the cap of Ripple, as the XRP Ledger is making its way through the financial sector. This can also help XRP in the charts and make it surge in value with its expanding use cases.
“Each Digital Token represents, and is at all times directly linked to, a corresponding traditional share of the Fund and cannot exist independently of such traditional share,” read the announcement. The concerns about the two getting out of sync are diminished, as the tokens are non-transferable. The shares in the XRP Ledger can only be issued, minted, or redeemed. Collateral mobility is also expected to be a major use case for the tokenized MMFs.
Several financial giants, banks, and investment management firms have adopted the XRP Ledger. Tokenized assets are generally considered safe due to their tamper-proof nature. The information once entered in the ledger can never be modified, altered, or deleted. This makes blockchain technology a safe and secure form of ledger, compared to the traditional system. Moreover, the only drawbacks of digital tokens are that accidental or fraudulent transfers can never be undone. Everything is permanent in blockchain, and every transaction initiated is final.
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