Chinese Bank Tokenizes $3.8 Billion Fund on BNB Chain

China Merchants Bank tokenized a $3.8B fund on BNB Chain.

The Hong Kong branch of China Merchants Bank has tokenized a money market fund with assets worth $3.8 billion on the BNB Chain.

In collaboration with CMB International Asset Management (CMBI), two tokens were launched on the blockchain: CMBMINT and CMBIMINT. Investors can purchase them using fiat or stablecoins, and redeem them via the DigiFT platform.

The infrastructure provider OnChain will ensure the integration of the tokens with DeFi applications, including lending protocols.

This is not CMBI’s first foray into the tokenization of real-world assets (RWA). In August, the division, in partnership with the DigiFT platform, issued a coin on the Solana blockchain, backed by the same fund.

The launch proceeded despite reports that the China Banking Regulatory Commission had informally instructed local brokers to halt RWA projects in Hong Kong.

CMBI was launched in early 2024. It invests in dollar deposits and government money market instruments. Since April, the fund’s assets under management have grown from $2.9 billion to $3.8 billion.

The Potential of the Tokenization Market

The volume of on-chain capital could exceed $100 trillion within five years, according to The Block, citing TD Cowen. Since 2020, the figure has surged to $4.6 trillion.

Analysts believe the appeal of tokenization lies in its practical benefits: reducing costs and speeding up cross-border settlements. The technology also enables the creation of programmable finance, directly integrated into capital market infrastructure.

Many companies have already moved from theory to pilot projects. BNY Mellon is exploring tokenized deposits to modernize payments, while BlackRock is considering launching digital funds tied to real assets. TD Cowen experts discussed these trends with representatives from JPMorgan, Bank of America, Euroclear, and Tradeweb.

These initiatives are also receiving political support. The United Kingdom plans to coordinate tokenization in wholesale markets, while major banks in the US and Europe are jointly exploring the launch of a stablecoin.

Investor demand is also growing. A survey by State Street revealed that most institutional investors expect to double their cryptocurrency investments within three years. More than half predict that by 2030, tokenized assets will comprise 10% to 24% of their portfolios.

“While the path remains thorny, political and regulatory progress has significantly exceeded our expectations even from two years ago. We believe this trend is too big to ignore,” stated TD Cowen.

Experts emphasized that the transition from pilot projects to mass adoption will occur when major institutions agree on unified standards.

In September, Galaxy Digital announced a partnership with Superstate to tokenize GLXY securities on Solana.

Subsequently, the RWA market capitalization surpassed $75 billion for the first time.