First Tokenized Money Market Fund Launched on XRP Ledger

Ripple and Archax introduced the first tokenized money market fund built on XRP Ledger (XRPL), fully regulated under U.K. legislation. 

In collaboration with Ripple, crypto exchange Archax provided access to a money market fund from U.K.-based asset management company abrdn. The fund, launched on the XRPL blockchain, represents a tokenized portion of the abrdn Liquidity Fund (Lux), which manages assets worth £3.8 billion (~$4.77 billion).

Archax is the first U.K.-licensed crypto exchange, broker, and custodian operating under the Financial Conduct Authority (FCA). It acts as a regulated intermediary for the tokenization of the abrdn money market fund. Access to the fund’s tokenized assets is limited to professional investors. 

The press release notes that the new investment product significantly reduces operational costs and improves settlement efficiency by leveraging XRPL’s capital markets infrastructure. Besides, the new product highlights the global trend of tokenizing real-world assets (RWA) in financial markets. 

Duncan Moir, Senior Investment Manager at abrdn, emphasized that the increased efficiency of end-to-end investment and settlement processes via blockchain technology delivers tangible benefits to market participants. He believes that the next stage in the evolution of financial market infrastructure will be the wider adoption of digital securities. 

Ripple will allocate $5 million to tokenized shares of the Lux fund, as part of a larger initiative to support tokenized assets built on XRPL. 

As of mid-November 2024, the tokenized real-world asset market exceeded $13 billion. Tokenization remains one of this year’s main trends, with major companies like BNB Chain and Tether presenting universal solutions for asset tokenization.