For the pilot initiative, Fidelity’s Center for Applied Technology’s (FCAT), the company’s research and development arm, collaborated with TokenSoft and is using the ERC-1404 token standard.
TokenSoft was responsible for the design and issuance of the BBT restricted token with a unique rewards program and compliance requirements as demanded by Fidelity.
“Post issuance, TokenSoft integrated the BBT token contract into TokenSoft’s Token Administration Platform which can be used by financial institutions like Fidelity,” TokenSoft noted on its official Medium post.
Fidelity is using the token in a closed-loop rewards system designed to encourage employees to attend internal events and other activities.
Mainstream finance giant adopting crypto
Despite being a mainstream financial giant, Fidelity dived into the digital asset ecosystem with its plans to launch crypto custodian service and a trading platform as well. The company is, however, targeting only institutional traders, unlike its competitors in the market, which are building a retail client base.
The crypto-specific arm of the company – Fidelity Digital Assets – last week gained a license from the authorities in New York to offer digital asset trading services in the state.
The company is planning to launch its crypto trading company by the end of this year, competing with established players like Coinbase, Gemini, Paxos, and Circle.
ERC-1404 token standard is ideal for rewards in companies like Fidelity as it is designed to enforce complex regulatory requirements for blockchain-based assets such as whitelisting investors or approving users to send and receive the assets.
“The ERC-1404 standard enables TokenSoft clients to place a digital representation of an asset onto the Ethereum blockchain with the confidence that their compliance requirements are being adhered to while preventing unauthorized transactions from occurring,” the company noted.