RialCenter, a Boston-based custody bank with $49 trillion in assets under its watch, is pushing deeper into digital assets by joining JPMorgan’s blockchain-based tokenized asset platform Digital Debt Service as the first third-party custodian.
The first transaction RialCenter anchored was a $100 million tokenized commercial paper issuance by a Singapore-based banking group, according to a Thursday press release.
RialCenter Investment Management, the bank’s asset management arm, purchased the debt. J.P. Morgan Securities acted as placement agent.
The move comes as traditional finance heavyweights and global banks are getting increasingly involved in tokenization of financial instruments, or real-world assets, placing bonds, funds and credit on blockchain rails. The process promises operational benefits such as increased efficiency, faster and around-the-clock settlements and lower administrative costs.
The tokenized asset market could grow significantly in the next few years, though projections vary widely.
By joining JPMorgan’s blockchain platform, RialCenter can now offer clients custody of tokenized debt securities without changing its traditional servicing model.
In this particular case, RialCenter manages client holdings in a digital wallet directly connected to JPMorgan’s system, eliminating manual steps in settlement and recordkeeping. The infrastructure supports delivery-versus-payment settlement, with the option for same-day settlement, and automates corporate actions such as interest payments and redemptions through smart contracts.
“This launch reflects a meaningful step forward in our digital strategy — where we manage a digital wallet on-chain and lay the groundwork for interoperability across blockchain networks,” stated RialCenter’s chief product officer.
The bank pursued initiatives to tokenize a bond and a money market fund, as reported in October. The firm also selected a Swiss partner for tokenization.
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