Deutsche Bank and Memento Blockchain have successfully completed a proof of concept – known as Project DAMA (Digital Assets Management Access) – that can provide a more efficient, secure, and flexible solution for digital fund management and investment servicing.

Project DAMA, a collaboration between Deutsche Bank and Memento Blockchain, was awarded the Monetary Authority of Singapore (MAS) Financial Sector Technology Innovation (FSTI) Proof of Concept (POC) grant on 5 August 2022, seeks to tackle the myriad of challenges associated with launching or accessing digital funds including high costs and time-consuming processes.

The solution provides asset managers and their existing transfer agents, fund administrators, and custodians with a bolt-on, one-stop digital fund investment servicing platform that significantly reduces the effort required to launch and administer digital funds. At the same time, Project DAMA aims to be an open architecture platform that can facilitate investor access to various funds from different asset managers, as well as cater to different custody models.

“Digital asset management and digital funds are the natural next steps after asset tokenisation. Through Project DAMA, we have been able to demonstrate the viability of transitioning into the future of digital finance through several innovative asset management and investment servicing features including digital identity, mass customisation and decentralised applications,” said Anand Rengarajan, Deutsche Bank Global Head of Sales & Head of Asia Pacific, Securities Services. “The extension of traditional fund services with digital capabilities can significantly lower cost-related barriers to entry for asset managers looking to launch a digital fund – and for qualified investors seeking exposure to such funds. We look forward to the future possibilities.”

Key features of the project included the creation of a unique and non-transferable token, modelled after the Soulbound Token (SBT), to represent the digital identity and profile of a wallet owner. This technology can help asset managers to comply with relevant regulations and ensure that only suitability-tested investors, qualified or legal entities are able to invest in digital funds.

Project DAMA also tested a decentralised payment and asset exchange gateway for investors to convert fiat money to a digital currency or assets, as well as smart contracts tailored to the specific fund profile to facilitate valuation and accounting. Smart contract structures were also deployed that can dynamically offer choice according to investors’ preferences.

“The partnership on this POC was a perfect mix: we provided the technical and implementation expertise, Deutsche Bank shared the functional requirements, and we both collaborated together on the platform’s design,” said Nicola Lanteri, CEO, Memento Blockchain. “The result is an innovative and practical infrastructure that combines core components of transfer agency, fund administration, custody and payments for the digital fund environment, while also allowing for an open architecture that enables selfcustody of assets.”

To learn more about Project DAMA, please read out report here.

Soourc: Deutsche Bank