Guggenheim Treasury Securities (GTS), a subsidiary of Guggenheim Capital, has successfully issued $20 million worth of Digital Commercial Paper (DCP) on the Ethereum blockchain. This development highlights the increasing use of blockchain technology in traditional finance. The DCP was awarded a P-1 credit rating by Moody’s, which is the highest possible short-term credit rating.
Blockchain Platform and Tokenization Services
In a statement released on Sept. 26, GTS revealed that the issuance of this digital paper would take place on AmpFi.Digital, a blockchain platform developed by Zeconomy. AmpFi.Digital provides tokenization services aimed at institutional investors. Giacinto Cosenza, the CEO of Zeconomy, expressed excitement over this collaboration, emphasizing the demand for secure and trusted blockchain solutions within decentralized finance (DeFi) and corporate treasuries.
“With tens of billions of dollars locked in DeFi and corporate treasuries, we are thrilled to partner with GTS to address a clear need for more trusted and secure blockchain solutions,” Cosenza stated.
Growth in the Tokenized US Treasuries Market
This initiative comes at a time when the tokenized US treasuries market has surpassed $2 billion in market cap. Major traditional finance institutions such as BlackRock and Franklin Templeton have entered this space, further validating the potential of tokenized securities. BlackRock’s BUIDL tokenized fund currently boasts a market cap exceeding $513 million, while Franklin Templeton’s FOBXX follows closely behind at $435 million.
Addressing Challenges in Decentralized Finance
AmpFi.Digital also announced that it aims to tackle several pressing issues in the DeFi space, such as poor credit quality, high transaction fees, and compliance challenges. Cosenza highlighted the growing institutional demand for crypto, especially with the approval of crypto exchange-traded funds (ETFs) in the United States and the rapid expansion of the tokenization market in 2024.
Ethereum’s Role in the Tokenized Securities Market
Ethereum has become the leading blockchain infrastructure for the issuance of tokenized US treasuries, with nearly $1.6 billion worth of treasuries being issued through its network. In addition to BlackRock’s BUIDL, other key players such as Ondo with its USDY and OUSG tokens, and Hashnote’s USYC, have significantly contributed to Ethereum’s dominance in this market.
Moreover, on Sept. 25, CoinDesk reported that Visa plans to develop the Visa Tokenized Asset Platform (VTAP), which will enable institutional firms to issue fiat-backed tokens. Ethereum’s infrastructure will also support this new platform, further cementing its place in the growing ecosystem of tokenized government securities.
Solana: A Rising Contender
While Ethereum continues to lead the tokenized securities market, Solana is emerging as a rising competitor. As of Sept. 26, Solana holds approximately 5.5% of the tokenized US government securities market, with $122.7 million in tokens issued on its network.
Recently, Franklin Templeton and Citigroup announced their intentions to explore Solana’s blockchain for future financial products. During Solana’s Breakpoint event, Franklin Templeton revealed plans to launch a mutual fund natively on the Solana network. Additionally, Citigroup is exploring Solana’s potential for programmable money through smart contracts, particularly in cross-border payments.
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