Goldman and BNY join forces to launch tokens linked to money market fund shares.

July 23 (Reuters) - Goldman Sachs (GS.N) and BNY (BK.N) have teamed up to launch digital tokens that reflect shares of money market funds, deepening Wall Street's push to bring blockchain technology to traditional finance.

Investors can now buy and sell shares of money market funds on BNY's LiquidityDirect platform, with a digital record of those shares created on Goldman’s blockchain system, the two financial giants said on Wednesday.

Other asset managers are also exploring tokenization. In January, Apollo (APO.N) partnered with Securitize to launch a feeder fund that would channel capital from native cryptocurrency investors into its global credit fund.

GAINING TRACTION

While it is still a topic of debate, the potential of tokenization to dramatically reshape the investment landscape has sparked significant interest.

It is touted as the next big breakthrough to bridge the gap between traditional and digital finance, and its proponents say it could open up an asset class that has long been out of reach for retail investors.

"We are about to do something very special, which is really the democratization of markets," said Chris Perkins, president of the cryptocurrency investment firm CoinFund.

The growing interest in tokenization coincides with renewed optimism in the cryptocurrency industry, which has rebounded in recent months and gained momentum after the Genius Act was passed earlier this month.

Critics, however, say that tokenization could allow companies to bypass established barriers meant to protect retail investors.

Source: Reuters.