Five major players join forces to break the game: Tokenization moves from testing to global connectivity

According to Woofun AI, the infrastructure architecture of global financial markets is at a critical turning point. Five institutions, Kinexys under JPMorgan Chase (JPM.US), HSBC Bank (HSBC.US), Mitsubishi UFJ Bank under Japan's Mitsubishi UFJ Financial Group (MUFG.US), SG-FORGE under Société Générale, and Standard Chartered Bank, announced the establishment of a non-profit organization “Global Layer One Organization (GL1 Org)” in Singapore on November 4. GL1 didn't start from scratch: the initiative was launched by the Monetary Authority of Singapore in November 2023 under the Project Guardian framework, and the first white paper was published in June 2024; this time, five participating institutions turned it into a permanent legal entity based in Singapore.

This initiative is not a simple institutional alliance, but rather aims to interconnect tokenized asset networks previously scattered across banks to break the long-standing “data silos” phenomenon by establishing internationally accepted technical and regulatory standards. The organization's core mission is to develop a set of general guidelines that can span different blockchain networks, so that banks and financial institutions in various countries can achieve seamless transactions and settlement of tokenized assets on the premise of ensuring compliance and security, marking that the asset tokenization process is moving from a closed laboratory to an open global financial transaction application field.

The underlying reason is that although tokenization technology can transform ownership of traditional financial assets such as stocks, bonds, and deposits into digital tokens on the blockchain, thereby automating transaction settlement and drastically reducing intermediary costs, its large-scale implementation has always been hampered by serious interoperability barriers. Since all major banks have developed their own independent blockchain systems, it is extremely difficult to transfer and settle assets between different networks. For example, if tokenized deposits issued on the J.P. Morgan blockchain platform are to be used in other bank systems, technical interface connections alone are far from sufficient; complex regulatory compliance issues such as determining the legal validity of assets, identification of counterparties, and anti-money laundering must also be simultaneously resolved.

According to data compiled by Woofun AI, the permanent GL1 organization was set up to solve these structural problems. Its strategy is not to force all banks to use the same underlying blockchain system, but rather to establish technical, operational, and regulatory principles that can connect to heterogeneous systems. Chia Der Jiun (Chia Der Jiun), managing director of the Monetary Authority of Singapore, warned in a speech at a conference on October 9 that if interoperability is lacking, the liquidity of the financial market will be scattered across multiple isolated networks, forcing institutions to repeatedly build infrastructure. To this end, the GL1 organization is promoting two sets of tools it has previously developed: the Market Infrastructure Toolkit (Market Infrastructure Toolkit), which sets up 108 controls based on international principles such as the Payments and Market Infrastructure Commission (CPMI) and the International Securities Regulatory Commission (SFC) for financial institutions to evaluate and design tokenized systems that meet the standards; the other is the Programmable Compliance Toolkit (Programmable Compliance Toolkit) to identify counterparties Anti-money laundering, and regulatory requirements from various countries require uniform design standards, so that institutions can handle cross-border transactions without establishing compliance mechanisms from scratch.

It is worth noting that this adjustment changed the organization of the tokenization test rather than ownership of ownership. GL1 changed from a public-private partnership mechanism hosted by the Monetary Authority of Singapore to a permanent organization with participating institutions setting up their own secretariats, while policymakers such as the Monetary Authority, the Bank of England, and the Bank of France continue to be listed as participants. This path itself is the result of long-term collaboration between private institutions and regulators. Ruby Ho, head of ASEAN markets and securities services at HSBC, said that although tokenization technology can make the financial market faster, more efficient, and more closely connected, these advantages can only be truly reflected if customers can trust the relevant infrastructure. The GL1 organization was founded to build this foundation of trust and eliminate market concerns about the safety of cross-chain transactions through standardized technical interfaces and transparent regulatory processes.

However, setting common standards is not the same as immediately building a unified payment network or launching commercial services for the public; this process still requires a lengthy testing and verification cycle. The GL1 organization also plans to expand the scope of participation in the future to include more financial institutions, financial market infrastructure operators, and fintech companies to join in order to form a more representative industry consensus. Looking back at its standardization process, the v1.0 preview version of the Market Infrastructure Toolkit was released in November 2025, v2.0 was launched on June 22, 2026, and a white paper on programmable compliance was released at the same time. Currently, network operators have completed self-assessments based on the toolkit, indicating that they have made some early accumulation in standardization construction.

From a structural point of view, the partnership of the five institutions is not only an integration at the technical level, but also an important evolution of the global financial governance model. By establishing a permanent standard-setting mechanism for public-private collaboration, GL1 organizations are expected to efficiently connect cross-border financial infrastructure while maintaining each country's regulatory sovereignty.

This “soft connectivity” strategy avoids the resistance that may be caused by forcibly unifying the underlying technology, and provides a flexible and expandable cooperation framework for financial institutions in different jurisdictions. With the addition of more financial institutions and infrastructure operators, this standard system is expected to gradually cover a wider range of financial asset categories and drive the development of the global financial market in a more transparent and efficient direction. Following the central bank's digital currency (CBDC) pilot, this is another substantial step forward in the field of blockchain technology integration. It indicates that future global financial infrastructure will show more standardized and interoperable characteristics.