Superstate To Launch a Tokenized Government Bond Fund

Superstate Inc., an investment adviser, has recently submitted a prospectus to the U.S. Securities and Exchange Commission for the launch of a tokenized government bond fund.

They claim that this fund could potentially rival stablecoins. The fund, named the Superstate Short-Term Government Bond Fund, enables shareholders to maintain a record of their ownership on the Ethereum blockchain.

They can choose to keep it under their own custody or through digital asset custodians, as stated by the company.

“Our vision is to create an SEC registered investment product that over time, competes with stablecoins to become the reserve asset & settlement choice of crypto,” the investment adviser said in a statement to The Block.

The fund is “an ultra-short duration government securities fund,” according to the prospectus, which includes U.S. Treasury securities, U.S. government agency securities, repurchase agreements collateralized by securities issued by the U.S. government or U.S. government agencies, and other U.S. government securities.

Superstate just completed a $4m equity funding round from ParaFi Capital, 1kx, Cumberland Ventures, Coinfund, and Distributed Global.

“The Fund will not directly or indirectly invest in any assets that rely on blockchain technology, such as cryptocurrencies,” Superstate said.

Robert Leshner, the CEO of Superstate Inc., established the leading lending protocol for Compound Labs and served as its CEO. Compound Labs is a company that designs open-source software for DeFi products.

Previously, Compound Treasury, a division of Compound Labs, offered institutional clients access to high-yield fixed interest, but it was shut down earlier this year.

The fund is akin to Franklin Templeton’s OnChain U.S. Government Money Fund, which was launched in 2021 and became the first U.S.-registered mutual fund to use a public blockchain for transaction processing and share ownership recording.

Stay tuned for more reports from the crypto space and make sure to check out the markets as well, as there are all kinds of bullish predictions out there.