• Bank of Italy has selected a DeFi initiative with Polygon Labs and Fireblocks to help financial institutions explore security tokens in a secure manner.
• The Milano Hub will actively support the development of an Institutional DeFi for the Security Token ecosystem.
• Tokenization has gained significant popularity, as traditional financial institutions and digital asset companies tokenize conventional assets like bonds and equities on blockchain platforms.
Bank of Italy Collaborates with Polygon Labs & Fireblocks
The innovation center of the Bank of Italy has selected a decentralized finance (DeFi) initiative that involves the collaboration of Polygon Labs, a developer specializing in scaling the Ethereum network, and Fireblocks, a crypto infrastructure provider. The primary objective of this project is to assist financial institutions in exploring security tokens and conducting transactions using DeFi protocols in a secure and compliant manner.
Objectives & Goals
Known as the Milano Hub, this establishment operates as the central bank’s hub for fostering innovative concepts in finance. For six months, the Milano Hub will actively support the development of an Institutional DeFi for the Security Token ecosystem. The ultimate goal of this platform is to enable traditional financial institutions to safely and compliantly experiment with security tokens and conduct transactions using DeFi protocols.
Tokenization Technology Gaining Popularity
The project emerges amidst the efforts of central banks worldwide to develop central bank digital currencies (CBDCs) and investigate methods to integrate blockchain technology into the current payment infrastructure. Simultaneously, tokenization has gained significant popularity in the cryptocurrency space, with traditional financial institutions and digital asset companies tokenizing conventional assets like bonds and equities on blockchain platforms. According to a report from Bank of America, tokenization has the potential to revolutionize value transfer, settlement, and storage across all industries. By facilitating faster transactions, reducing expenses, and establishing a more streamlined financial infrastructure, tokenization could bring about significant transformative changes.
Key Players & Participants
Collaboration with Industry Leaders: Key Players and Participants Cetif Advisory, a consulting firm associated with Reply Group leads platform development alongside Polygon Labs’ expertise on scaling Ethereum networks while Fireblock provides its cutting-edge institutional grade security solutions for protecting digital assets during transit or storage phases within DeFI protocols. Furthermore Linklaters LLP works together with DVRS Tax Law Firm providing legal advice related to STOs matters while Intesa Sanpaolo is one among other Italian banks working towards creating use cases based on Security Tokens technologies leveraging Polygon solutions .
Conclusion
Italy is embracing tokenization technology by collaborating with industry leaders such as Polygon Labs & Fireblocks through its innovation center at Milano Hub which aims at enabling traditional financial institutions explore security tokens via Defi protocols securely & compliantly thus transforming value transfer settlement & storage across various industries globally .
