Today Metzler Asset Management (MAM) announced German tokenized fund issuance, so-called crypto funds. Despite the name, this is not a cryptocurrency. Instead, the asset manager issued the tokenized fund shares in compliance with Germany’s ‘crypto’ securities laws which waive the requirement for a central securities depositary (CSD). That’s only if a DLT or blockchain is used to register ownership of bearer fund shares.
For this three month pilot, Metzler partnered with fundsonchain and Cashlink, which has been involved in many of Germany’s crypto bond issuances.
Stepping back, Germany introduced two pieces of legislation supporting the use of blockchain instead of a CSD. The Electronic Securities Act (eWpG) allows for a centralized ledger or a decentralized (“crypto”) one for bearer bonds. Earlier this year, Siemens issued a €60 million bond on a public blockchain in compliance with this law. This means that investors can transfer bonds peer-to-peer.
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