Moody’s (MCO) Shakes Up Finance: Live-Testing Crypto Tokenization of Bond Ratings

Wall Street meets blockchain—Moody’s dives headfirst into tokenizing bond ratings, proving even dinosaurs can learn new tricks.

Why it matters: Traditional credit ratings just got a DeFi facelift. The move could slash settlement times from days to seconds—if the suits don’t strangle it in committee first.

The cynical take: Nothing says ''innovation'' like a 116-year-old firm chasing crypto relevancy. At least they didn’t call it ''MoodyCoin.''

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The trial was conducted on the solana (SOL) blockchain and showcases how credit ratings that are usually distributed through traditional data terminals can also be integrated into tokenized assets on public blockchains.

As part of the test, simulated municipal bond ratings were tokenized and moved to Solana’s public blockchain. For financial institutions and large institutional investors, the lack of standardized, trusted information transfer over blockchain remains an impediment to adoption.

Mainstream Acceptance

Moody’s is hoping that placing a known credit rating into a secure token and disseminating it over a blockchain will allow traders and portfolio managers to make informed decisions about debt instruments in real time.

The test also highlights how blockchain technology can complement traditional financial networks, with potential applications for funds and credit, as well as bonds. The process known as tokenization promises more efficient operations, interoperability, and faster settlements than legacy finance technology.

The Boston Consulting Group has forecast that tokenized assets could become an $18.90 trillion market by 2033. Moody’s said it will continue exploring how its ratings can serve digital finance. The stock of Moody’s has gained 3% this year.

Is MCO Stock a Buy?

The stock of Moody’s Corp. has a consensus Moderate Buy rating among 16 Wall Street analysts. That rating is based on 10 buy, five Hold, and one Sell recommendations issued in the last three months. The average MCO price target of $506.36 implies 3.79% upside from current levels.