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US Federal Reserve Board (FRB) Governor Christopher Waller spoke about the potential benefits and risks of blockchain-based asset tokenization and related the use of smart contracts. In particular, he pointed to the way that smart contract-enabled atomic settlement can mitigate settlement and counterparty credit risks by ensuring that the buyer will not pay if the seller does not deliver; and conversely, that the seller will not deliver if the buyer does not pay. However, smart contracts can have bugs and potential cyber vulnerabilities; and instantaneous settlement raises its own set of risks.

The Canton Network, launched in May 2023 completed its exploration of a privacy-enabled open blockchain network for real-time atomic settlement and immediate reconciliation across counterparty systems of tokenized investment asset transactions. Based on more than 350 simulated transactions, the project proved that the blockchain could be leveraged to streamline and synchronize financial applications while at the same time adhering to regulatory asset control, security, and data privacy requirements. It involved 15 asset managers, 13 banks, four custodians, three exchanges, and one financial market infrastructure provider. It exchanged tokenized securities, money market funds and deposits across 22 decentralized applications (dApps).