Global Digital Finance (GDF) has published a landmark report and sandbox results demonstrating the legal and operational viability of tokenised money market funds (TMMFs) as collateral instruments across the UK, Ireland and Luxembourg.
The report, published on 3 November, highlights growing legal clarity around tokenised MMFs in Luxembourg and the UK, where English law governs Credit Support Annexes (CSAs) and statutory frameworks support digital-native fund structures. While Ireland’s treatment of tokenised shares remains less defined, the report suggests Irish courts would likely apply conventional share principles, enabling enforceability under existing property law.
Over 70 firms contributed to the working group, including JP Morgan, BlackRock, State Street, EY, Lloyds Banking Group and Hogan Lovells. Thirty of these firms participated in the GDF Industry Sandbox, powered by Ownera’s FinP2P protocol, simulating six production-ready use cases—from bilateral transfers to default scenarios and triparty funding.
“This is a major step forward in demonstrating how tokenisation can enhance collateral efficiency, reduce friction, and unlock new trading opportunities,” said Peter Left, head of digital finance at Lloyds Banking Group.
The sandbox identified no significant legal, operational or regulatory obstacles to implementation, according to GDF’s summary findings.
GDF Chair Lawrence Wintermeyer called the initiative “a time that has arrived for the global securities industry,” with a US working group set to launch in January 2026.
The full report, “The Case for Collateral Mobility in Europe & the UK using Tokenized Money Market Funds,” is available via GDF’s website.
