Aug 20 Reuters State Street is partnering with Swiss crypto company Taurus to offer new digital asset services, including turning realworld assets into tradeable tokens, to tap growing institutional demand for such investments, the U.S. financial services provider told Reuters.

As cryptocurrencies have spread in the financial system through regulated products including futures and exchangetraded funds, they are drawing more interest from institutions seeking ways to hedge inflation and diversify portfolios.

Through the partnership, State Street, which provides crypto fund administration and accounting services, will hold clients39; crypto assets and help them create tokenized assets, such as funds and other securities.

Reuters is the first to report on the partnership.

Tokenizing involves converting ownership rights to traditional assets into digital tokens on a blockchain, a decentralized database controlled by all its users. Proponents say the consensus mechanism, which enhances transparency and security, makes the assets easier to trade.

BlackRock, for example, has a tokenized fund on the ethereum blockchain that allows investors to earn U.S. dollar yields.

Donna Milrod, chief product officer at State Street and head of digital asset solutions, said the new service is geared toward asset management clients looking for partners to help tokenize their funds.

We need to provide our clients the ability to deal with both traditional finance as well as digital assets…