UBS Quietly Advances Token Efforts With Clients

UBS has been quietly running a tokenization trial with weighty institutional investors. The Swiss-based bank has been offering more than 100 institutional clients access to a pilot program to tokenize real assets. The project is operating on the Ethereum platform, the person said.

This represents the next step in a push into putting assets on the blockchain and selling slices represented in coins. The project, being overseen by UBS investment banker Chetan Tolia, is looking at tokenizing traditional assets including debt, structured products, and physical gold.

The Swiss wealth manager last week dipped its toes into cryptocurrencies, in a major concession to client demand. The tokenization program has quietly been running, separately out of UBS’ investment bank, for at least 12 months, the person said. UBS declined to comment.

UBS has long held that it is interested in distributed ledger more than it is in cryptocurrencies themselves – which represent a threat to traditional banking. The Swiss bank transacts on we.trade, a blockchain-based trade finance platform, co-launched a so-called utility settlement coin with other banks, and is part of banking’s R3 blockchain consortium.

It isn’t clear how long UBS intends to run the tokenization pilot or release it more widely, or which products it is tokenizing.