South Korea’s Mirae Asset is making a big bet on the future of investing, teaming up with Ondo Finance to bring some of its investment products onto the blockchain.
The decision, which was announced Tuesday, adds one of Asia’s biggest asset managers to the list of large players in the conventional finance world who have embraced the tokenization movement, which experts see as having the potential to revolutionize global markets.
Through this new partnership, Mirae Asset Global Investments and Ondo Finance will ink a memorandum of understanding (MOU) for working together on various blockchain investment solutions.
For Mirae, this move is far from being a minor initiative. The firm manages approximately $721 billion worth of assets, whereas the Global X ETF platform manages in excess of $263 billion through its suite of funds.
The idea behind the partnership is to facilitate the trading of conventional investment solutions using blockchain.
Terms of the agreement
Under the deal, both the firms are planning to work in three key areas. Firstly, they are planning to tokenize Global X ETFs; secondly, the development of blockchain infrastructure for asset management; and lastly, creation of new types of digital investments products for their customers worldwide.
Additionally, Mirae also disclosed its intention to tokenize U.S. listed ETFs using its subsidiary firm located in the United States of America, Global X. Although the partnership clearly depicts the future plan of actions for the firms, it is not yet an operational agreement. More time will be needed to work out details related to regulation, the structure of the product, and distribution of the product itself.
However, there is one product which will be available within the next several months. Specifically, Mirae is planning to launch tokenized shares of the Global X HSCEI Covered Call Active ETF in Q3 2026.
It should be noted that the product does not change; investors are not going to acquire any crypto-related or synthetic ETFs. It means that the only difference in this case is that investors will use blockchain technology to acquire shares of the Global X HSCEI Covered Call Active ETF.
Investors would still receive dividends and the same economic exposure to the fund, while benefiting from blockchain-based infrastructure.
The technology behind the project comes from Ondo Global Markets, Ondo Finance’s platform for tokenized securities.
Ondo has already brought more than 100 U.S. stocks and ETFs onto blockchain networks and says its platform has surpassed $1 billion in total value locked.
Why is the deal important?
What is most intriguing in regard to the Mirae deal is that here the asset management company is tokenizing its own products.
In contrast to previous cases, where the tokenization process was carried out by a third party around existing assets, it might be considered a sign that big financial organizations are finally treating tokenization as an alternative method of distributing their products rather than experimenting with blockchain technology.
On one hand, for Mirae such collaboration might lead to the emergence of new categories of clients that prefer using digital wallets to manage assets as opposed to trading via a traditional broker account.
On the other hand, for Ondo it might indicate its progress towards reaching success in its strategic plans.
Ondo spent a considerable number of years developing its technology for regulated infrastructure for tokenized securities through acquisitions, collaborations, and approvals from the government. In early February of 2023, MetaMask added tokens from Ondo to its list of tokenized securities and ETFs.
The collaboration with Mirae might thus be perceived as another milestone for Ondo that allows expanding the list of prominent financial institutions that collaborate with the company.
The first real test will come later this year with the planned launch of the tokenized Global X ETF share class. If it goes well, it could lead to more tokenized funds and encourage other large financial institutions across Asia to explore similar strategies.
