Real-world asset (RWA) tokenization is one of the growing niches in the blockchain industry, besides stablecoins. Adding to the wave, Aviva Investors has planned to tokenize traditional funds on Ripple’s XRP Ledger (XRPL). Aviva Investors, the global asset management arm of U.K. insurer Aviva, will integrate Ripple’s support to issue and manage tokenized funds on the blockchain ledger.
TradFi’s tokenization move increases
Both firms have integrated to share services amid the growing trend of traditional finance (TradFi) moving into decentralized finance (DeFi). Tokenization, the digital representation of a physical asset on a blockchain, has reached approximately $24 billion, according to RWA.xyz, a blockchain analytics platform.
Amid this surge, Aviva Investor’s tokenization pivot can be considered a milestone, as this is its entry into the niche. However, Ripple’s tokenization leap is not something new, as it has been actively involved in the sector since its win over the SEC vs Ripple case.
No specific funds disclosed for tokenization
Aviva Investors will tokenize regulated investment funds, which the firm has been providing to its investors in the traditional financial system. In brief, the funds of investors associated with the firm will be available as shares of digital tokens on XRPL. However, the company has not yet specified the names or categories of the funds.
Aviva Investors aims to “incorporate tokenised solutions into their existing product offering”, read an official statement.
Ripple’s XRP Ledger grows in offering tokenization
As mentioned, Ripple’s XRP Ledger is not a new face in tokenization. A UAE-based project tokenized nearly $280 million in polished diamonds on the XRPL.
The same blockchain ledger was used to tokenize real estate property in partnership with Dubai Land Department and Prypco Mint, the Middle East’s first regulated, blockchain-based real estate tokenization platform.
In the US, several tokenized securities are live on XRPL via Ondo Finance, a decentralized finance platform well known in RWA tokenization. Money market funds have also landed on the ledger as Archax and abrdn integrated to tokenize investment funds.
“With its built-in compliance tools, near-instant settlement, and native liquidity, the XRPL provides the secure and scalable infrastructure required to support the next generation of institutional assets,” said Nigel Khakoo of Ripple in the wake of integration with Aviva Investors.
