T. Rowe Price Associates, WisdomTree, Wellington Management, and Cumberland will evaluate the advantages of on-chain trades and settlement calculations for currency and interest-rate swaps. To this end they will use the Spruce testnet oriented for financial-institution Evergreen subnet of the Avalanche blockchain.
In later stages of development, additional third-party dapps, assets and processes will be made available, including the issuance of tokenized stocks and bonds, trading and fund management.
Spruce is designed to enable institutions to interact with public blockchain infrastructure with low risk and minimal barriers to entry. The use of test tokens allows testing the functionality of Evergreen without risking capital.
Evergreen subnets — EVM–blockchains with a controlled set of validators and a user token to secure transactions.
Institutions will play a key role in providing ongoing feedback on the subnet architecture, integrations, and capabilities to ensure the successful and scalable deployment of the mainnet.
“Participation provides an opportunity to broaden understanding and analysis of smart-contract technology and the potential application of public and private blockchains in financial markets,” said Blue Makellari, head of the Digital Assets Strategy at T. Rowe Price Associates.
Will Peck, head of Digital Assets at WisdomTree, noted the pivotal role of tokenization and blockchain in the industry’s development.
Upon registration in Spruce, institutions receive non-transferable tokens (NTT) with indication of completed KYC/KYB checks. Addresses are added to an allowlist that tracks on-chain access.
Smart-contract developers who have integrated the core infrastructure and applications also undergo onboarding.
In March 2023, Bank of America mentioned Avalanche among blockchains of the ‘new era’.
Earlier, BlackRock chief Larry Fink noted that tokenization can boost efficiency in capital markets