Axelar Foundation and Citigroup jointly released a white paper to promote the standardization of global blockchain asset transactions

Axelar (AXL) Foundation announced the release of its latest white paper "Institutional Interoperability", which aims to promote seamless transactions across blockchain assets and improve transparency and efficiency in financial markets.

According to Reuters, unless global standards are established to support cross-border activities and allow assets to flow seamlessly between different blockchains, large-scale trading of stocks and bonds on blockchains will remain out of reach.

So-called tokenized assets represent underlying assets that are traded on distributed ledger technology (DLT), which is also used for cryptocurrency trading. Banks hope to achieve faster, cheaper and more transparent transactions through tokenized asset trading. However, the lack of unified global regulation has hindered the smooth flow of assets between different blockchains. At an event in Amsterdam this week, industry executives said the development of tokenized assets has been slow and current acceptance remains limited.

Georgios Vlachos, co-founder of blockchain interoperability company Axelar, pointed out that since customer needs and compliance requirements vary significantly around the world, it is difficult for a single fixed solution to meet all needs. He also mentioned that in the current environment, there are differences in the pace of development and focus areas in different regulatory regions.

The white paper on blockchain transactions was co-authored by the Axelar Foundation and digital asset risk assessment expert Metrika, and has the participation and support of many well-known financial institutions such as Citi, Deutsche Bank, Northern Trust, Mastercard, Centrifuge and Metrica.

Citi is developing a range of digital asset products, adopting a multi-asset strategy across multiple corporate business lines. Citi's digital asset exploration covers multiple areas such as digital currency, trading, securities, custody and asset services.

However, Boon Hiong Chan, Head of Asia Pacific, Securities and Technology Advocacy, Deutsche Bank, said that premature formulation of industry standards may limit innovation, lead to missed better solutions, and even make existing standards obsolete. Deutsche Bank also emphasized that in order to reduce the risk of gas fee payments flowing to sanctioned entities, especially in systems that need to integrate multiple blockchains, a complex abstract system must be developed to effectively enhance risk management capabilities. In its white paper, Deutsche Bank further pointed out that in order to promote wider industry adoption, there is an urgent need to develop a set of industry-recognized risk assessment standards.

At the same time, Northern Trust announced its specific timetable for carbon credit markets and digital bond custody solutions. The company expects that by 2030, the size of its digital asset market will account for 10% of the approximately $13 trillion in assets currently under custody. They believe that achieving this goal requires the use of multiple blockchain technologies. In addition, Mastercard draws on its successful experience in connecting banks in the field of credit card payments and is committed to improving the interoperability of financial institutions between different blockchain systems. The company looks to the future and expects to achieve an era in which all types of information can be securely stored and circulated on a verifiable ledger. Centrifuge is committed to building a modular multi-chain architecture designed to support the tokenized asset and RWA ecosystems. Its core goal is to create a seamless experience that ensures that investors and issuers can enjoy unified and easy-to-use products and services regardless of the underlying blockchain technology. Metrika dives into risk assessment and monitoring and proposes a set of guidelines for building a risk framework and defining risk areas. The company then recommends assigning key risk indicators (KRIs), which are quantitative indicators used for risk management, monitoring and white papers.

According to 21co data, approximately $85.12 billion in assets have been digitized through tokenization technology, covering categories such as government bonds, legal stablecoins, and commodities.

Axelar said at X that the Axelar Foundation and Metrika plan to host a panel discussion at the Point Zero Forum in Zurich from July 1 to 3 to delve deeper into the insights in the white paper and the challenges facing the future of asset tokenization. Interested participants can register by downloading the white paper and sending an email to receive an invitation.

About Axelar

Axelar focuses on providing cross-chain interoperability solutions, aiming to achieve seamless exchange of assets and information between different blockchain platforms. With continuous innovation and technological advancement, Axelar is helping the global financial market move towards digital transformation.

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