Tokenization experiment might be carried out on DFA platform infrastructure

MOSCOW. May 21 (Interfax) - Russia's bill on tokenization calls for establishing an experimental legal regime under which this process will be launched based on already existing platforms to issue digital financial assets (DFA), the head of the financial policy department at the Finance Ministry, Alexei Yakovlev said.

"The concept [for tokenization] calls for, foremost, identifying the types of assets that we need to gradually try to tokenize, determine concrete business cases, meaning what can this give us in given sectors. And prepare for the regulatory changes that we'll need to provide for, because the list of objects that can be subject to tokenization is, of course, very broad. This is movable property, and real estate, foremost commercial. This is objects of intellectual rights, this is stakes in limited liability companies," Yakovlev said at the Alfa Summit organized by Alfa Bank.

"Accordingly, concurrently with working on launching and developing this concept, we're already working on the regulatory framework for how one could pilot given cases, when we select them. We've drafted a federal law for this and it is now going through the interagency approval process. It is planned that under the experimental legal regime it will be possible to actually launch the process of tokenization based on digital financial asset platforms, through our information system operators," Yakovlev said.

He said the Finance Ministry expects that the text of the bill that will make it possible to pilot these issues will be submitted to the government soon.

"Speaking about what tokenization can give us, I think it's no secret to anyone that this is, of course, greater liquidity, greater investment appeal, a lower entry threshold for investment thanks to the splitting of shares in ownership rights. This is increased clarity and security for investors, since it will be possible to spell out all terms in a smart contract," Yakovlev said.

"We already now have key players in the person of development institutions that are interested in this. I'm still speaking somewhat abstractly, because we're agreeing the final details but, of course, how this will be formalized will probably have to be discussed in a wider circle," Yakovlev added.