The new Universal Ledger developed by Google Cloud will help CME Group introduce innovative solutions for consistent and reliable wholesale payments and asset tokenization.
CME Group, a leading derivatives marketplace, has expanded its partnership with Google Cloud to leverage the latter’s distributed ledger in its tokenization initiatives.
The partners will begin direct testing with market participants later this year, planning to launch new services already in 2026.
The tokenization project will use the technical foundation of Google Cloud Universal Ledger (GCUL). This novel solution is designed to facilitate the tokenization of assets and streamline their clearing and settlement processes. The digital asset management platform developed by Google Cloud offers several potential benefits in capital market operations. Namely, GCUL supposedly streamlines account and asset management while enabling seamless transfers on a secure, private network. Google Cloud claims that this efficient platform allows participants to maximise their strengths, quickly launch new services, and deliver better experiences tailored to evolving client needs.
However, some critics of the technology have voiced their concerns about the GCUL’s centralised and permissioned nature. They argue that this approach conflicts with the foundational principles of blockchain technology, eliminating some core benefits of its use, such as enhanced security, transparency, inclusivity and fairness brought by reduced reliance on single entities. Besides, opponents of the centralised distributed ledgers mention associated safety risks, such as single points of failure and increased vulnerability to cyberattacks.
Despite these concerns, proponents believe that GCUL can align with the broader goals of security, transparency, and resilience, delivering significant improvements in collateral management, margining, settlement, and fee payments.
Rohit Bhat, General Manager of Financial Services at Google Cloud, stated that their primary goal is to offer partners cutting-edge infrastructure that enables them to drive innovation, improve efficiency, and navigate the complexities of modern financial systems. He highlighted the partnership with CME Group on GCUL as a clear example of this commitment, emphasizing how Google Cloud supports its partners in transforming their businesses through strategic collaborations and advanced technology, ultimately creating new opportunities in the global financial market.
CME Group provides trading services across futures, options, cash, and OTC markets, helping clients manage risk and optimise portfolios. Its exchanges offer global benchmark products in interest rates, equities, foreign exchange, energy, agriculture, and metals. The company facilitates futures and options trading via CME Globex, fixed-income trading through BrokerTec, and foreign exchange trading on EBS. It also operates CME Clearing, a leading central counterparty clearing provider.
The changing nature of modern markets ignites a growing interest in integrating traditional financial instruments with blockchain technology. The shift has already produced several tokenized money market funds and other financial instruments providing real-world asset tokenization. Some projections estimate the value of tokenized real-world assets could reach $16 trillion as soon as 2030, signalling strong market demand for such innovative financial tools.
